Ford Motor Company f was up about 1.6% on Wednesday, along with the S&P 500 trading about 0.5% higher after a volatile start in the afternoon.

Working with the general market, Ford broke away from a four-hour bull flag. The bull flag pattern is generated with a sharp rise forming the pole, which is then followed by a consolidation pattern, lowering the inventory between a parallel line channel or into a tightening triangle pattern.

For bearish traders, the “trend is your friend” (until it isn’t) and the stock can continue lower within the following channel for a short time. Aggressive traders may choose to sell the stock at the upper trendline and exit the trade at the lower trendline.

Bullish traders should watch for a breakout from the upper descending trend line of the flag pattern on high volume to enter. When a stock breaks out of a bullish flag pattern, the upward movement measured is the length of the bar and should be added to the lowest price within the flag.

A bull flag is negated when a stock closes a trading day below the lower trendline of the flag pattern or when the flag falls more than 50% down the pole.

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The Ford Diagram: Ford’s bull flag was formed between Dec. 28 and Tuesday, with the pole formed during the first eight trading days of this time frame and the downward sloping flag printed between Monday and Tuesday. On Wednesday, Ford surged above the upper trend line of the flag pattern, resulting in a bullish break of the pattern.

• The measured movement of the bull flag is around 18%, which suggests that Ford could climb towards the $14 level going forward. However, it should be remembered that stocks never move up or down in a straight line for an extended period of time.
• Ford is trading in an uptrend that was confirmed Tuesday lower high of $12.50. On Wednesday Ford…