Hi RDS1933,

Thanks for the comment and welcome to the community.

What I think most people would agree a flag formation is saying from a market psychology standpoint is that the market has just had a big push in one direction and will thus need a period of consolidation for its next move. If the previous move that formed the flag is a push up then it is expected that the market will continue to push higher after it "takes a bit to catch its breath" which forms the consolidation. As such traders will look for a breakout to the upside to confirm this.

So in answer to the first part of your question (and I could see how others may disagree here and would love to hear from those that do) is that yes that push up can be considered the flagpole part of the formation because the market did have a big push up. Granted that big push up was off of panic selling but it was a big push up nonetheless. So I would say that the flag is formed by the push up not the push down.

As that is my opinion if I were looking at the pattern I would say yes you can use the low and then the high for the bar that forms the flagpole to measure the move.

As far as your other questions it is really a matter of personal preference whether you trade based on technicals, fundamentals, or a mixture of the two. There are profitable traders in each category there so in my opinion that is a decision each trader should make for themselves.

Hope that helps and if there are any other opinions on this I would love to hear them.

Best Regards,

Dave