Identification: A pennant is a continuation pattern which is formed when initially there is a large movement in a security, known as the flagpole, which is then followed by a consolidation period with converging trend lines, known as the pennant.
Occurrence: This pattern occurs during a consolidation period after a large movement has occurred.
Study: The end of pennant signifies the chances of a breakout movement in the same direction as the initial large movement, further representing the second half of the flagpole. Consolidation occurs at lower volumes and breakout during higher volumes.