Canary Capital, led by former Valkyrie co-founder Steven McClurg, has filed with the SEC to launch an ETF tracking Axelar’s AXL token, citing its strong developer team and growing institutional adoption. 

The S&P 500 gained 1.12%, led by materials, consumer discretionary, and industrials, after a one-month auto tariff exemption. Gold dipped 0.1% to $2,913.79, holding above $2,900 amid tariff concerns and ahead of U.S. payroll data. Coindesk Indices, an index measuring broader cryptocurrency market performance was up by 3.42%, with Bitcoin and Ether rising by 4.24% and 2.71%, respectively in the past 24 hours. Trade these markets and more with up to 500x leverage on Bybit MT5 using this 

Today’s top performer is KAITO, which surged nearly 6.51% following the announcement of Kaito AI powering FalconX’s AskFocal to enhance crypto market insights.

Kaito (KAITO), founded in 2022, is an AI-powered crypto search engine that indexes web3 sources beyond traditional search engines. Priced at $1,099/month, it gathers data from platforms like Twitter, Discord, and research papers, using AI to filter noise and assess sentiment. 

, an AI-driven platform helping 80+ funds managing $10B+ navigate crypto markets by analyzing sentiment and filtering data from partners like CoinGecko and Token Terminal.

Check Out the Latest Prices, Charts, and Data of 

Canary Capital, led by former Valkyrie co-founder Steven McClurg, has filed with the SEC to launch an ETF tracking Axelar’s AXL token, citing its strong developer team and growing institutional adoption. Axelar, a cross-chain protocol integrated by J.P. Morgan, Microsoft, Uniswap, and MetaMask, enables secure blockchain interoperability. Former Coinbase legal chief Brian Brooks has joined Axelar’s new Institutional Advisory Board to support regulatory alignment. McClurg believes AXL will become a top-20 token as the market recognizes its potential.

Yesterday, BTC Spot ETFs saw a total net outflow of $6.9M, with no change in GBTC and the entire outflow coming from non-GBTC funds.

, a game server platform, raised $13.5M in funding and is backed by Bitkraft, Solana, and Polygon. Its Beamable Points Program is live, allowing users to earn points for a potential airdrop. The "Day 1 OG Badge" claim ends in 6 hours, so users should quickly create an account, complete tasks, and claim the badge.

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Canary Capital Files for Axelar ETF as Institutional Adoption Grows

Aave's new proposal outlines a major update to its tokenomics, focusing on revenue distribution, risk management, and a buyback initiative.

The S&P 500 dropped 1.22%, with most sectors down except tech, which gained on chipmakers and crypto stocks. Gold rose to $2,918 as US tariffs weakened the USD, fueling safe-haven demand amid recession fears. Coindesk Indices, an index measuring broader cryptocurrency market performance was up by 1.02%, with Bitcoin and Ether rising by 1.02% and 3.20%, respectively in the past 24 hours. Trade these markets and more with up to 500x leverage on Bybit MT5 using this 

Today’s top performer is ADA, which surged nearly 18.4% following major developments, including its inclusion in the U.S. Crypto Strategic Reserve, governance advancements, and staking updates.

Cardano (ADA), founded in 2015 is a third-gen Proof of Stake blockchain designed to address scalability issues. Its five-phase roadmap—Byron (launch), Shelley (decentralization), Goguen (smart contracts), Basho (sidechains), and Voltaire (governance)—aims to make Cardano fully decentralized and self-funded. 

 ADA’s inclusion in the U.S. Crypto Strategic Reserve, an upgraded staking rewards calculator, and IOG’s new documentary on Cardano’s governance. Other key updates include Babel Fees for flexible payments, the 2025+ governance roadmap for on-chain voting, and the launch of the Cardano Development & Ecosystem Cooperative (CDEC) to drive decentralized innovation.

 outlines a major update to its tokenomics, focusing on revenue distribution, risk management, and a buyback initiative. It retains rewards for GHO stakers while introducing “Anti-GHO,” a non-transferable token earned by AAVE and StkBPT stakers. The “Umbrella” safety system is designed to reduce the impact of bank runs and safeguard against bad debt. Additionally, the proposal suggests forming the Aave Finance Committee (AFC) to manage a $1M/week AAVE buyback over six months. With DeFi expanding and Aave leading at $17.5B in total value locked, buybacks are increasingly used to boost investor confidence and ecosystem resilience.

Yesterday, BTC Spot ETFs had a net outflow of $143.5M, with GBTC unchanged and all losses from non-GBTC funds.

 token on Ronin on March 11 after migrating from Avalanche. The 7B supply token will fuel the game's ecosystem, with 50% allocated to community incentives, including airdrops and staking rewards. A community sale via Ronin Launchpad offers FAME at $0.00429 before launch. The game, backed by NBA stars and brands like Gatorade, aims to expand its sports gaming presence.

Aave Proposes Tokenomics Revamp with Safety System, Revenue Redistribution, and Buybacks

A Polkadot Spot ETF would offer investors direct exposure to Polkadot's native token, DOT, by holding the actual cryptocurrency within the fund.

There's been a flurry of crypto spot ETF applications recently, with Grayscale, Bitwise, 21Shares and other asset managers filing applications for products based on 

. Polkadot is the latest cryptocurrency to jump into the fray, with both Grayscale and 21Shares submitting applications currently under SEC review.

If approved, a Polkadot Spot ETF would offer a regulated and accessible avenue for institutional investors to gain direct exposure to DOT, enhancing both market transparency and liquidity. 

In this article, we’ll explore the implications of the Polkadot Spot ETF application, assess its potential impact on market dynamics and examine the challenges it faces in a competitive ETF landscape.

 that would track the price of Polkadot's native token, DOT, offering direct exposure to its market performance. It would allow investors to gain exposure to DOT without directly holding the cryptocurrency.

A Polkadot Spot ETF is designed to provide investors with direct exposure to Polkadot’s native token, DOT, by holding the actual token, rather than relying on derivative instruments (such as futures). This structure ensures that the ETF would closely track DOT’s real-time market price in order to provide a transparent and authentic reflection of the underlying asset's performance.

The ETF would purchase and securely store DOT tokens through specialized custodial services. These custodians would employ robust security measures, such as multi-signature authentication and cold storage, to protect the tokens from theft and operational risks. The fund holds the physical asset in order to maintain a direct link to Polkadot's market value, which is a crucial factor for investor confidence and accurate tracking of the asset’s performance.

Polkadot Spot ETF valuation hinges on its net asset value (NAV), calculated by dividing the total market value of the held DOT tokens by the number of ETF shares outstanding. This NAV is updated frequently, often throughout the trading day, ensuring that the ETF’s price remains in close alignment with the aggregated prices of DOT from multiple reputable cryptocurrency exchanges. Aggregating the price index helps the fund minimize the impact of anomalies or potential price manipulation on any single exchange.

The creation and redemption process is an essential mechanism within this ETF framework. Authorized Participants (APs), typically large financial institutions, are empowered to create new ETF shares by depositing a predefined amount of DOT tokens into the fund, or conversely, by redeeming shares for the underlying tokens when discrepancies between the market price and NAV arise. This 

 process helps to maintain the ETF’s trading price, in line with its underlying asset value, keeping the asset’s market stable and liquid.

The prospective fund takes risk management and regulatory oversight seriously. Investors are still exposed to the inherent volatility of the cryptocurrency market, but the ETF structure offers enhanced regulatory safeguards, transparent reporting and periodic audits. These measures help mitigate risks, such as custody breaches and liquidity issues, thus providing a more secure investment vehicle as compared to investors directly managing crypto assets themselves.

On Feb 25, 2025, Grayscale Investments filed with the US Securities and Exchange Commission (SEC) to launch a Spot Polkadot ETF, aiming to list it on the Nasdaq-100 exchange under the ticker symbol "DOT." This move aligns with Grayscale's strategy to expand its crypto ETF offerings, following similar filings for XRP and Cardano Spot ETFs. Before this, on Jan 31, 2025, asset management firm 21Shares applied to the SEC to introduce a Spot Polkadot ETF, proposing to list it on the Cboe BZX Exchange, with Coinbase as the custodian. 

The SEC has initiated its standard review process for these applications, which typically spans 45 days, with the possibility of extensions. Historically, the SEC has exercised caution in approving cryptocurrency-based ETFs, primarily due to concerns about market manipulation and investor protection. However, recent developments indicate a potential shift in the regulatory stance. The US election of Donald Trump, who has expressed intentions to position the US as a leader in cryptocurrency innovation, has fostered optimism about a more crypto-friendly regulatory environment. This political change could influence the SEC's approach to pending ETF applications, including those for Polkadot.

Impact of Polkadot Spot ETF applications on the crypto market

Following Grayscale's announcement, DOT's price 

 within 24 hours, signaling robust investor optimism about the potential for increased institutional access and liquidity. However, the broader crypto community remains divided. Some stakeholders see the potential spot ETF as a gateway to greater market transparency and capital inflows, while others express caution over the influence of institutional investments on the inherently volatile crypto ecosystem.

Despite the notable price movement, overall market sentiment has been mixed. The 

, indicating that underlying concerns persist despite the spot ETF filings. Investors are now closely monitoring the SEC’s forthcoming decisions, as any approval could set important precedents for altcoin ETFs and shape the future direction of cryptocurrency adoption.

What will it mean if a Polkadot Spot ETF application is approved?

Approval of a Polkadot Spot ETF would mark a significant moment in the ongoing effort to merge traditional finance and cryptocurrency. This milestone would provide investors with a regulated and accessible avenue to gain exposure to Polkadot’s native token, DOT, without the complexities and risks associated with directly holding and managing the digital asset. Investing in an ETF that physically holds DOT tokens would allow market participants to bypass the need for secure storage and technical management, bolstering investor confidence.

For institutional investors, the approval represents a significant validation of Polkadot as a credible asset. With a regulated ETF in place, financial institutions that have long been cautious about crypto due to regulatory and custodial uncertainties would gain a familiar and compliant investment vehicle. The ETF’s creation and redemption processes, which are usually managed by authorized participants, would ensure that any discrepancies between DOT’s market price and the underlying asset’s value would be quickly addressed through arbitrage, maintaining liquidity and pricing integrity.

From a market perspective, the approval of a Polkadot Spot ETF could lead to increased liquidity and price stabilization. As institutional capital flows in, higher trading volumes are expected to mitigate extreme volatility, offering a more balanced market environment. This improved liquidity benefits DOT by reducing erratic price swings, and enhances the overall efficiency of the crypto market, making it more attractive to a broader range of investors.

Regulatory validation through an SEC-approved Spot Polkadot ETF would further bolster market sentiment. Investors and market observers alike would interpret the SEC’s endorsement as a sign that Polkadot has met stringent security, custody and operational standards. This approval could pave the way for similar products based on other cryptocurrencies, potentially diversifying and maturing the crypto investment landscape. Again, the increased confidence resulting from regulatory recognition might spur further adoption, potentially driving up demand for DOT, and, subsequently, its price.

The approval of a Polkadot Spot ETF would democratize access to DOT by bridging the gap between traditional and crypto markets. It would also enhance market stability, validate the underlying asset and stimulate broader investor participation. This anticipated development is set to be a catalyst for both increased liquidity and a new era of regulatory confidence in the digital asset ecosystem.

Looking to capture the market and trade DOT tokens? Bybit offers the 

The approval process for Polkadot Spot ETFs is underway, with key applications from Grayscale and 21Shares under SEC review. The changing regulatory environment, influenced by recent political shifts, may play a major role in the SEC's forthcoming decisions, which are highly anticipated by market participants. Approval of a Polkadot Spot ETF would be a landmark moment that bridges traditional finance with cryptocurrency by offering enhanced liquidity, regulatory validation and easier institutional access to DOT. Such a development could stabilize prices and drive broader adoption, paving the way for a more mature and integrated digital asset ecosystem.

Intermediate

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Polkadot Spot ETF: Vying for a spot in the competitive ETF landscape

Sonic (S) evolves Fantom’s legacy with 10,000 TPS, sub-second finality and FeeM incentives, boosting DeFi scalability and developer rewards.

Launched in 2019, Fantom has long been regarded as one of the leading 

 (EVM)–compatible blockchains. For years, the blockchain has been highly valued by 

 (DApp) developers and operators for its high-performance characteristics. In over five years of operation, until early 2025, Fantom has attracted hundreds of DApps in 

In August 2024, the Fantom team announced a significant rebranding and migration to a new blockchain platform, Sonic. Four months later, in December 2024, the Sonic chain’s mainnet was officially launched. 

A key part of the migration process has been the transition from Fantom’s FTM coin to Sonic’s S token, which was officially launched in January 2025 at a 1:1 rate to FTM. While Fantom has always been known as a fast, scalable blockchain, Sonic takes these technical advantages to a completely new level, boasting a throughput of 10,000 

 (TPS) and a sub-second transaction finality.

In addition to technical improvements, Sonic has introduced an attractive developer incentive program that’s not only generous, but also has the potential to significantly accelerate DApp growth on the new platform.

With the launch of Sonic and the migration from FTM to S, Fantom’s team is opening a new era in the project’s history, one in which the platform’s well-regarded technical features are being combined with an unprecedented developer incentivization drive. This could potentially position the new Sonic chain as a major force in the world of EVM-compatible blockchains.

In 2018, South Korean computer scientist Ahn Byung Ik founded the 

 (FTM) project to develop a fast, high-performance blockchain. In December 2019, the Fantom blockchain was officially launched, quickly becoming one of the leading decentralized networks in the industry. The platform was and still is known for its excellent scalability, low transaction confirmation times and minimal costs. Notably, the EVM-compatible blockchain makes transitioning between the tremendously popular 

 (ETH) and Fantom a smooth and quick process.

In addition to these advantages, Fantom also boasts a secure, highly fault-tolerant consensus mechanism, and is environmentally friendly. Fantom's website proudly states that the network consumes 70 million times less energy to process a transaction than 

 (BTC). This staggering difference is attributable primarily to Fantom's efficient 

 (PoS) block validation method, which is vastly more energy-efficient than Bitcoin's 

However, even compared to many other PoS blockchains, Fantom stands out in terms of its energy efficiency and performance. Fantom's Virtual Machine, Opera, remains one of the industry's most scalable and fast processing engines.

As of early 2025, Fantom continues to operate as usual, despite the migration announcement (covered in detail in the section below). According to data from 

 portal, its network features 450 functioning DApps as of Mar 3, 2025. Popular DApp categories on the chain include DeFi, gaming and NFTs, as well as apps in smaller niches, such as SocialFi and gambling.

In August 2024, the Fantom project announced a rebranding and migration to a new blockchain, 

 (S). The organizational entity behind the blockchain was also rebranded, from Fantom to Sonic Labs. Sonic's mainnet was launched in mid-December 2024. 

As of February 2025, the migration of FTM coins, the native cryptocurrency of the Fantom chain, to Sonic's S token is ongoing. Users can migrate their FTM to S at a fixed rate of 1:1 using the 

. This fixed ratio will be maintained for an initial period of six months after the launch of Sonic (i.e., until about mid-June 2025).

The migration portal will support two-way transfers between FTM and S until mid-March 2025. After that, only one-way transfers from FTM to S will be possible. Eventually, the Fantom chain is expected to be retired, although the project’s team hasn't yet announced a precise date for the chain's discontinuation. Per the project's public communications, the Fantom chain and its Opera smart contract layer will continue operating for the "foreseeable future."

Fantom is also in discussions with major crypto exchanges to facilitate the automatic transfer of user funds from FTM to S, and any staked FTM funds can be unlocked immediately for the migration to S.

The Sonic upgrade allows the platform to achieve a stellar throughput rate of 10,000 TPS, one of the best results in the industry. Sonic also features sub-second finality times, meaning that transactions are rarely reversible on the network. This feature is critical for many DeFi apps, as operators and users prefer the certainty of quickly finalized confirmations. Slow finality times on blockchains have often been linked to poor user experience, as well as a range of hacks in which user funds have been compromised.

The claims of outstanding throughput and finality aren't just sloganeering by the Sonic Labs team. Per information from the project, Sonic has been thoroughly stress-tested in its 

 mode with up to 175 million daily transactions, demonstrating its ability to withstand heavy loads. Even when subjected to the heaviest loads, the network has managed to maintain transaction confirmation times of no worse than 1.1 second. In short, the S chain is among the most scalable and fast networks in the blockchain world.

As with Fantom Opera, Sonic's processing engine is also EVM-compatible and 

To encourage the development and growth of the Sonic ecosystem, the project has introduced a novel Fee Monetization (FeeM) incentive program. FeeM is a gas monetization system that rewards developers with up to 90% of the network fees generated by their applications. This initiative aims to provide a sustainable income stream for developers, encouraging them to focus on scaling their apps and growing their user bases on the platform.

While the Sonic network has inherited some of Fantom's core properties, it’s introduced significant upgrades to improve network performance. Sonic’s 

 chain features a PoS block validation model, an asynchronous Byzantine fault tolerance (aBFT) 

Sonic's consensus mechanism is based on the 

 model, which Fantom first popularized. Combined with a DAG structure, it allows block processing without the need for a strict sequential order of confirmations.

Sonic's approach allows nodes to reach agreement independently without waiting for other nodes to confirm the blocks. Unlike traditional BFT systems, Sonic's aBFT consensus mechanism ensures the blockchain is fast and efficient, even under heavy loads, with transactions finalized almost instantly. Using the Lachesis model allows Sonic to maintain rapid transaction processing, excellent scalability and industry-grade security without sacrificing the network's decentralization.

The Sonic Virtual Machine (SVM) is the platform's smart contract–capable execution engine. Sonic’s documentation states that the SVM will replace the default EVM engine used by the blockchain, a move that’s expected to boost Sonic's processing speed further.

The SVM is fully compatible with the EVM, and supports the main development tools used in an EVM environment, specifically the Solidity and Vyper programming languages and the Go-based implementation of Ethereum, 

Sonic's database storage system is designed to efficiently manage the blockchain's "world state," which includes everything from address account data to virtual machine code and smart contract storage. A key feature of this system is its live pruning capability. In blockchain technology, “pruning” refers to removing outdated or unnecessary historical data from the network's database to save storage space and improve efficiency.

In the past, pruning required validator nodes to go offline, risking downtime and creating operational inefficiencies. Now, the process can be completed by a node in real time without having to go offline. This means validators can continue to process blocks while the system automatically discards outdated data. This ensures smooth network operations while significantly reducing storage space requirements.

Sonic’s live pruning system separates the database into two parts — LiveDB and ArchiveDB. LiveDB stores only the current block’s world state, while ArchiveDB keeps the history of all previous blocks. Validators interact exclusively with LiveDB, handling only the current state of the network, while specialized archive nodes manage both LiveDB and ArchiveDB to process historical data requests when requested.

Sonic Gateway is a bridging solution designed for asset transfers between Ethereum and Sonic. The bridge offers a convenient, two-way transfer system. When you deposit your assets, it takes around 15 minutes to confirm on Ethereum and only about a second on Sonic. After the confirmation, your deposit is batched with others to save on gas fees, and processed in intervals — every 10 minutes for transfers from Ethereum-to-Sonic, and once an hour for Sonic-to-Ethereum transactions. If you don't want to wait for batched processing, you can pay a Fast Lane fee to execute your transfer instantly.

The Sonic chain's native coin, S, first became available on the crypto market in early January 2025. S is used for 

, stake delegation, block reward payouts to validators, gas fee payments and governance.

Validators stake S to participate in the block processing activity on the network. Users who don't act as validators can delegate their S to a preferred validator node in order to earn a share of block rewards, which are also paid out in S.

In addition, S is used to pay for network fees on Sonic, similar to the way that Ethereum’s blockchain uses Ether (ETH). S holders can also participate in 

 votes for a say in the platform's future direction and existing operations.

As noted previously, in February 2025 there's an ongoing migration process from Fantom's FTM to Sonic's S. Using the migration portal, you can move your FTM funds to S anytime. The project hasn't announced a deadline for the migration.

The S token’s total supply of 3,175,000,000 is exactly the same as FTM's total and maximum supply. However, unlike FTM, S isn’t a supply-capped token. For the first six months after the blockchain's mainnet launch (until mid-June 2025), the supply of S will remain fixed, with no additional issuance. After that, it's expected that S will include a certain 

, with new S released for ecosystem growth, incentives and validator rewards.

However, the emission rate is reduced with three burn mechanisms:

 — Fifty percent of the transaction fee will be burned if a user transacts on an app that isn't participating in FeeM.

 — Users who choose not to wait for the full 270-day maturation period for 75% of their

 will lose a portion of their S tokens, which will be burned.

 — Unused tokens from Sonic’s annual minting (for the first six years) will be burned.

 event during which 190.5 million S will be distributed to active ecosystem participants both on the Fantom Opera and Sonic chains. During the first season of the airdrop, S allocations can be claimed until June 2025. 

As part of the airdrop, users can earn Sonic Points, reward points that qualify you for S coins. You can earn Sonic Points by holding or deploying whitelisted assets on the chain. The table below lists these whitelisted assets.

There are also developer-focused reward points called Sonic Gems. These are distributed to contributing DApps, and can be further reallocated by DApp operators among their own users.

Sonic’s S coin is available on Bybit's Spot market as a 

As of Mar 4, 2025, the S coin is trading at $0.53, which is 47.8% lower than its ATH of $1.03 on Jan 4, 2024 and 49.3% higher than its ATL of $0.3596 on Feb 3, 2025. Long-term price forecasts for S are mostly bullish.DigitalCoinPrice 

 of $1.85 in 2027 and $2.85 in 2030, whileCoinCodex 

 $0.63 in 2027 and rise to $2.17 in 2030.

Since the early days of its market presence, Fantom has been recognized as a highly scalable and efficient blockchain. With its transition to Sonic, the project’s team hopes to solidify this reputation even further. Sonic isn’t just a rebrand of Fantom — it's an entirely new platform that incorporates technical upgrades and improvements, resulting in impressive properties — such as 10,000 TPS, one of the best throughput capacities in the industry. Moreover, in addition to technical enhancements, the platform's generous developer incentive program, FeeM, is hard to ignore if you’re in the game of building or operating DApps. Along with Sonic's stellar technical characteristics, FeeM may just help drive the project's ecosystem growth on a scale that the original Fantom chain could only dream of.

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From Fantom to Sonic (S): Enhancing speed and scalability in DeFi

Trading

Trading the bull flag pattern helps you to spot continuations in price and capture large price swings. But does it work in crypto? Learn more.

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Trading the bull flag pattern helps you spot continuations in price and capture large price swings with ease. Usually, it’s tough to enter into a fast-moving trade within a market, but it’s easier to time the market with the bull flag chart pattern.

In fact! Did you know the most explosive moves in any market (stock, forex, commodity, or cryptocurrency) are the result of price pattern breakouts such as flags?

The best traders in the world have many trading strategies in their arsenal. However, one of the most popular is the bull flag pattern, along with its counterpart, the bear flag. These patterns allow traders to participate in trending markets, understand price moves, and establish low-risk entries.

Whether you’re a beginner or experienced trader, here’s an overview of what this chart pattern is all about. Here’s what you’ll learn:

A bull flag is a technical pattern that provides an accurate entry to participate in a strong uptrend. Many professional traders use this continuation pattern to find the optimal place to trade with the trend.

It’s important to note that the bull flag pattern perfectly suits cryptocurrency market conditions because of the powerful trends from which savvy investors can benefit. Whether you intend to use this flag pattern for 

, it works very well. Flag patterns are beneficial for trading after a breakout or during a strong trending market.

In short, the main purpose of the bull flag pattern is to help you participate in the current momentum of the market. That means you can leverage the information it provides to determine entry levels where risk is low compared to the possible reward. From the visual perspective, this pattern has a previous strong movement to the upside (the pole) and then a consolidation that takes the form of a flag.

The following BTCUSD 15-minute chart is an excellent example indicating the main elements that create the bull flag pattern.

In essence, the bullish flag formation has three main features:

2. A downward sloping consolidation, aka the flag

3. The continuation following the break of the upper channel resistance

Identifying the bull flag formation in real-time provides an edge in the market, particularly for crypto traders. This is because it helps identify the areas where corrective action occurs before the previous trend continues.

First of all, however, we need to know the key features to look for when trading the bullish flag pattern. This chart pattern must include previous momentum, usually represented by consecutive bullish bars to the upside.

Later on, corrective action should take the form of consolidation. Usually, the price correction can be framed within a downtrend channel, pennants, triangles, or sideways action.

The third stage of the bull flag pattern is the break of the flag, which provides the ideal entry signal.

The bullish flag pattern’s initial profit target will be around the previous swing high, and the stop-loss order can be placed below the consolidation structure.

Additionally, the bull flag profit target can be established by measuring the distance in price between the flagpole’s base and the highest point of the flag. To pinpoint your exact profit target, you need to project the measured move to the upside starting from the breakout point.

The below BTCUSD 15-minute chart clarifies the details of this formation.

Finally, follow these steps to identify the bull flag pattern:

Identify directional movement to the upside. Usually, this momentum can be framed under consecutive bars to the upside, with very few retracements bars.

Wait for corrective action. Usually, this correction can be framed under a downtrend channel, where a structure like a lower low can be presented.

Define the breakout level to enter the order. More details about the trading execution are presented in the next section.

At first glance, flag chart patterns look almost identical to pennant patterns. They are both continuation patterns that form whenever there’s a sharp price movement, followed by a sideways price movement. Usually, they only last around one to three weeks. But despite the similarities, there are indeed some differences. 

. It’s normally characterized by converging trend lines, which occur when successive highs and lows form a trading range. With the steep move up or down, it’s consolidated in the pennant form, with descending resistance and rising support. Generally, you would want to use pennants in conjunction with other 

 to serve as confirmation. A good practice is to use the 

(RSI) indicator to moderate during the consolidation phase and reach oversold levels.

A flag pattern forms when a steep rise (or fall) is first followed by trading in a narrow price range, then by a steep rise (or fall). Typically, a flag helps to make sure the candle closes above the 

To succeed in trading with flags or pennant chart patterns, it’s wise to always use volume as a guide to deciding on your entry and exit points of a target price. That’s because it’ll help you to confirm the breakouts and to speculate on the momentum after it.

Ultimately, the patterns may or may not be defined at a particular time. However, as long as you’re patient, they will form at the right time.

Now that we know how to identify the bull flag pattern, it’s important to define specific criteria to understand how to trade it.

After the flag pattern has been identified, the entry should be located where the downtrend channel (the structure that frames the flag) fails to keep its downward momentum.

The long entry must be placed at the break of the flag, while the stop-loss order (risk) should ideally be placed below the consolidation flag. The first target should be around the previous swing high. If the trend is strong enough, the movement will continue.

Of course, trade management varies. It mainly depends on the style of each trader. Still, one good strategy is to close a part of the position around the previous swing high. Then, trail the stop-loss order based on a 

 provides a detailed, step-by-step guide to identify a bull flag and trade it effectively.

First of all, the prevailing trend must have strong bullish momentum, as mentioned above. This momentum is usually framed under consecutive bullish bars to the upside, with very few corrective actions.

The directional movement is strong in the image below, and there are only a few small retracements. 

Secondly, we must wait for the consolidation. In this case, after a lower high is made, a line for a downtrend channel can be drawn, and we can be ready for the break of the flag if it occurs.

When the flag is broken by the price, the long entry is triggered. At the same time, the stop loss would be placed at the opposite side of the flag pattern. The red area represents the risk (the amount of money that we may lose), and the green area represents the potential reward.

After the entry is triggered, it’s time to wait and see what happens. In this example, the price goes straight to the previous swing high. 

Trade management should be done based on the trader’s risk profile. The fastest way to cash in some profits is to close only a portion of the position around the target area and let the rest of the position run. 

Alternatively, you can close the entire position all at once by projecting the flagpole price range to the upside. For this particular example, the price keeps going, making new highs. 

Bear in mind that many bull flag trading strategies are based on different price formations and shapes of the flag. The period of consolidation that forms the flag can take the following shapes:

The anatomy of a breakout consists of three stages:

 (flag price structure) should be well-defined within two down-sloping parallel trend lines.

, a genuine breakout, occurs when the price spikes through the upper resistance line. The key element is that the breakout needs to be accompanied by heavy volume.

, in which a breakout is confirmed by the price closing above the upper resistance line, along with sustained follow-through buying above the flag.

The consolidation that makes up the flag tends to have well-defined support and resistance levels. While the consolidation shows equilibrium between the forces of supply and demand, it can also be seen as the calm before the storm.

Because the prevailing trend is upward, there’s a higher probability of trend continuation and, subsequently, an upward breakout. Usually, investors who have accumulated and bought into the cryptocurrency during the initial rally still hold their bags. Then, during the consolidation phase, investors who have missed the initial drive-up will try to get their hands on the cryptocurrency as well.

The excessive buying interest will eventually cause an imbalance between supply and demand forces and drive the price higher.

In conclusion, it’s important to understand that most trends are the result of a breakout.

The difference between a bullish and a bearish flag is in the direction of the price movement. With the bullish flag, the idea is to participate in a strong uptrend. Meanwhile, with the bearish flag pattern, the idea is to trade short in the direction of the prevailing downtrend.

Cryptocurrency provides the opportunity to find both bullish and bearish flags. This is because it’s a market with high volatility (directional movements), where opportunities to trade long or short are presented almost daily, depending on the execution time frame.

In general terms, the trading concepts for a bullish flag listed in this guide can be applied to the bearish flag as well.

To better understand how to identify a bearish flag pattern and trade the continuation move, we’ll outline a trade example.

, the price is trading sideways between the support of $1,685 and the resistance of $1,720 (the two areas are highlighted in light blue). Notice how the price breaks the support to the downside. At this point, there are only two possible outcomes:

1. A continuation of the breakdown, in which the immediate downtrend continues.

2. A failed breakout that reverses the prices back to the previous range.

Therefore, if we want to play the continuation for the breakout, we should wait for some corrective action (the flag) to participate in the downtrend.

The bearish flag pattern offers low-risk entry points if you enter on the breakout of the flag formation. We’ll use the same entry concepts that are applied to the bullish flag pattern.

In the next chart, we can see that the price makes a higher low, a point from which we can draw the flag. If the higher low is unable to hold, the ideal entry will be below that price structure.

The entry-level and stop-loss level is illustrated in the next chart.

At the next stage, the price eventually breaks below the flag and triggers the short entry.

The previous swing low is essential if we want to define the strength of the sellers — or, in other words, the strength of the downtrend. If the price is unable to break it, the downtrend might not have enough momentum. In this case, we may have to tighten our 

Effectively, after the price breaks the swing low, the downtrend continues to the next level of support (blue line).

This example illustrates the dynamic of how to spot and trade a bearish flag. It also clarifies the similarities with the bull flag pattern, which has the same core properties. The only difference between the bull flag and the bear flag is in the direction of the prevailing trend.

In general, flag patterns and pennants are reliable. The bull flag has been proven to work and is used by profitable traders around the world. Of course, trading is full of uncertainties. Still, these indicators and chart patterns offer traders certain confidence. However, they come with a set of pros and cons — and bull or bear flags are no exception.

• A bull flag breakout provides a well-defined price level to enter a long trade. It establishes a clear place for the stop-loss order, thereby providing the right support for proper trade management.

• Usually, this pattern provides asymmetrical risk-to-reward scenarios in which the potential profit (target) is larger than the risk. In other words, it’s a pattern that offers the basis for a good risk management system.

• The bull flag pattern is a simple formation to use in a trending market. The steps to identify the pattern are clear-cut.

The main risk of the bull flag pattern is the potential for 

. Some people may experience negative results executing this pattern because the context is not framed under a trending environment but, rather, a sideways market.

To minimize the risks and increase the chance of success, spend your time studying several bull flag charts so that you can get used to its action. This way, when it’s time to execute the pattern, it will come more naturally.

What Is A Bull Flag Pattern (Bullish) & How to Trade With It

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