Continuation patterns are chart formations that signal a temporary pause in the prevailing trend before the price resumes in the same direction. They help traders identify potential entry points during trend consolidations. The most common types include flags, pennants, triangles, and rectangles.

Flags are small, sloped rectangles that move against the trend and are preceded by a sharp price movement called the flagpole. They often indicate strong momentum.

Pennants are similar to flags but are shaped like small symmetrical triangles, showing converging trendlines after a rapid move.

Triangles come in three main forms: symmetrical, ascending, and descending. Symmetrical triangles usually signal continuation but can break either way, while ascending and descending triangles tend to break in the direction of the prior trend.

Rectangles represent horizontal consolidation zones where the price moves between parallel support and resistance levels.

Volume is a critical factor in these patterns, often decreasing during consolidation and increasing on breakout. Recognising these formations can help traders anticipate the continuation of a trend, set price targets, and manage risk more effectively. Proper confirmation, such as a breakout with volume, is essential to avoid false signals.