Flag pattern and tight weeks: scanning for quiet pauses after a run

A flag is a pause after a sharp rise: price makes a strong run-up, then drifts or consolidates in a tight range. Tight weeks are the same idea on the weekly chart. Both look for stocks digesting gains before another move.

Watch the Popular Scans in the scanner (Hindi, from 8:51).

Flags

The scanner’s flag screen looks for a run-up of 25% or more into a recent high, followed by a tight pullback of 12% or less. The run-up is the “pole” and the quiet pullback is the “flag”. The screen lists the pole size and the depth of the pullback so you can compare setups.

Tight weeks

The tight weeks screen looks for three or more weekly closes within about 1.5% of one another while price holds above the 50-day average. Closes that barely change from week to week show that sellers and buyers are balanced, which often comes before a decisive move.

How to judge quality

• A shallow flag after a big pole is generally better than a deep one.
• Volume should dry up during the pause.
• The stock should still be above its rising moving averages.
• Relative strength should stay high.

Related setups

Flags and tight bases are close relatives of the VCP and the Darvas box. All four look for low-volatility pauses near highs. Check them together on the swing trading screener page.

A worked example

A stock rises 38% in six weeks to 520, then drifts to 480 over seven sessions, an 8% pullback, with volume well below the average. That is a flag: a 38% pole followed by a pullback under 12%. Separately, a stock with weekly closes of 612, 615, 613 and 614 has four tight weeks, all within 1.5% of each other, above its 50-day average.

Strategy examples

These are illustrative rule sets that show how the scanner can be used. They are not recommendations or advice, the numbers are examples, and rules like these can lose money. Test any idea on your own and manage risk before acting.

Shallow flag after a strong pole

1. Run the Flags screen with RS 70 or higher.
2. Prefer the largest pole with the shallowest pullback.
3. Mark the flag high on the chart and set an alert just above it.
4. Place a stop below the flag low.

Tight weeks watchlist

1. Run Tight weeks with at least three tight closes.
2. Keep stocks within 10% of their 52-week high.
3. Review weekly and drop any that loosen or break the 50-day average.

Flag plus volume

1. Look for flags where volume dries up in the pause.
2. Act only on a close above the flag high with volume well above average.
3. Skip flags that break below the 50-day average.

Common mistakes

• Calling any dip a flag. The pole should be strong and the pause tight.
• Entering before the breakout confirms.
• Ignoring volume.
• Holding flags that break down because they “should” work.

Frequently asked questions

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