The High Tight Flag
Masterclass Model Book
(Sneak Preview)
About Leif Soreide
Married Father of 4
MBA in Finance
Entrepreneur
Started trading in 1996
2019 U.S. Investing Championship Winner
Founder of [Link]
Favorite Stock Pattern: The High Tight Flag!
Trading Influences
William O’Neil – CANSLIM
Mike Webster and David Ryan - CANSLIM
Stan Weinstein - Stage Analysis
Mark Minervini – Early Entries
The High Tight Flag
Masterclass
1. Define and trade High Tight Flags 2. Discuss the nuances that matter
3. Consider risk management 4. Review many trade examples
A single edge can transform your trading career. Never stop looking for it.
The High Tight Flag Masterclass
Webinar 1: Finding & Webinar 2: Advanced
Entering High Tight Flags Trading of High Tight Flags
Nov 2, 11am EST Nov 9, 11am EST
Introduction to the Masterclass High Tight Flags Entry Tactics Revisited
Defining High Tight Flags High Tight Flag Risk Position Management
Screening and Finding High Tight Flags High Tight Flag Sell Rules
Grading High Tight Flags In Depth Examples
High Tight Flags Entry Tactics Low Tight Flags and Rocket Bases
High Tight Flag Risk Management High Tight Flag Variant Examples
Examples Key Takeaways
Q&A Q&A
Defining the High Tight Flag Setup
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Pattern Definition
The High Tight Flag (HTF) is a rare bullish
continuation pattern that’s credited to William
O’Neil.
The initial uptrend, often referred to as the
“flagpole”, typically has a duration of 8 weeks
or less and rises 90%+.
The flag typically has a duration of 3-5 weeks.
The decline from flag’s high to its low should
be no more than 25%.
We want to trade around this momentum. I will give
you my interpretation of this pattern and how I trade it.
If a HTF fails you should still track it as it can set up
later.
O’Neil’s Interpretation from
How to Make Money in Stocks
Generally a 100 to 120% move in no more than a few weeks during a bull
market.
The flagpole should form in 4-8 weeks, then correct no more than 10-25%
in 3-5 weeks.
The HTF is one of the strongest chart patterns, but it’s also fraught with
risk and difficult to interpret correctly.
Stocks can rally 200% or more following this pattern.
O’Neil’s examples exhibit HTFs on weekly charts that are breaking out to
new highs.
CAN SLIM
C: Current quarterly earnings
A: Annual earnings
N: New products, services, or management
S: Supply and demand
L: Leaders or laggards
I: Institutional ownership
M: Market direction
When evaluating HTFs and considering the CAN SLIM method I
overweight the stocks of companies with new products or services.
HTF Components
1. Flagpole - 25 days, +160%
2. Flag - 17 days, -18%
3. Flag Volume - Dried up
4. Pivot
5. Pivot Volume
High Tight Flag Setup Characteristics
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Price and Volume
Pass or Fail? I prefer to trade stocks priced $10 and higher.
Higher priced stocks tend to be more liquid.
The average volume traded over the last 50 days should be at least 200k.
I pass on stocks with an RS rating below 97 as setups with low
momentum are failure prone.
Industry Group
Improve Your Odds of Success Does it belong to a highly volatile or speculative industry group, like
Biotech? Or a slow moving group, like Utilities or Banks?
Trade tighter flags How is the group performing as a whole?
Be suspicious of a stock that is trading well in a poorly performing
Look for the N in CAN SLIM industry group where other members of the group are trending lower.
A steady 45 degree rise in pole Story
A slight drift lower to right in the flag before Does it have the N in CANSLIM?
breakout What new product or service is the company offering?
Are they reinvigorating a stagnant market with a new innovation?
Trade liquid, high RS stocks that are listed This WeeK
on the Nasdaq and NYSE Ownership: Do reputable high performing institutions hold the stock? Is the
size of their position increasing?
Chart Pattern
Textbook patterns get an A, but are rare.
How tight is the flag and how long has it been flagging?
Is the pivot or pullback buy point well defined?
Is the stock floating back to prices last seen just a year or so ago?
Leif Soreide
Champion Team Trading If trading conditions are good, imperfect patterns are allowed.
High Tight Flag Examples
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CELH - 2020
19% Deep Flag
104% Flag Pole
Inside Day
ASTS - 2024
Earnings
Pivot
380% Flag Pole
Inside Day
Inside Day
Tight Price Action
ZIM IPO HTF - 2021
99% Flag Pole 16% Deep Flag
Diagonal Breakout Buy
Test of Lows
RKLB - 2024
14% Deep Flag
104% Flag Pole
HTF Early
Entry
Inside Day
Respect for 8ema
Early Entry (Before HTF)
Inside Day
Declining
Low Volume
Volume
High Tight Flag Entry Rules
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The tighter the flag, the better.
HTF Entry If a HTF only corrects 15% or less, then the breakout is good to buy and your standard stop is
more likely to hold. I typically use a stop of 5%. Best to time high breakout entry in the 3-5 week
timeframe.
Earlier entries are preferred. As the saying goes, confirmation is for Catholics. I like to add to
trades as soon as they start to work.
Improve Your Odds of Success
Being early sometimes means having to try a trade multiple times.
A great entry is key. Being well
The break of a downward trending with a least 3 points downtrends can be meaningful, especially
positioned in a winner leaves you with
when combined with a break of a nearby horizontal pivot.
more risk management options.
Look for a slight dip in the ATR into the buy point. It may be subtle as there is not much time in the
I prefer to get in ahead of the breakout.
flag to see a huge drop. Some examples we will review, like PRTS, will illustrate a textbook drop.
Utilize inside days and buy the breakout above the prior day’s high. We don’t buy intraday
support.
The Masterclass Dead volume to the buy point can work on the daily timeframe. High relative volume at the break
out is ideal, but higher volume can also come in later as theT breakout
his WeeK gains attention.
goes in depth Sometimes the move comes once the sellers are done making it easier for buyers to push the
stock with lighter volume.
into entries with Look for skyscraper volume bars on the daily timeframe all the way up the pole like below:
many examples
High Tight Flag Sell Rules
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When to Sell - We have many more slides expanding on this with examples
Take Scales Into Strength
No sales are perfect, it is very low odds to top tick anything.
Sell large extensions from the 50sma.
Sell into huge up volume days. Once everyone is in the stock there may be fewer buyers
to continue the move higher.
In a great HTF move you will almost always leave money on the table by taking some
early or selling into weakness as things round trip.
The ideal scenario is taking off a little into several risk multiples and letting it trend, taking
scales along the way.
Scales Can Be Added Back
We are looking at several add spots in ASTS for example.
My initial target is typically 3R or around 15%. HTF’s that are on the move usually offer up mini flags and other areas to aggressively
This WeeK
add back.
Note the character of a stock, which moving average You can adjust your risk on the scales and treat them as separate trades.
fits it best as it trends? Focus on that average.
Scales are easier to do with a name you have made good money on and trending HTF’s
usually mean you are making a good return.
High Tight Flag Webinar 1 Slides (Sneak Preview)
The High Tight Flag Masterclass
Webinar 1: Finding & Webinar 2: Advanced
Entering High Tight Flags Trading of High Tight Flags
Nov 2, 11am EST Nov 9, 11am EST
“Leif has taught me a ridiculous amount in a short time. I would pay 10x
for the knowledge he shares. He has improved my trading in a way I
never thought possible. Thank you Leif you are changing lives.”
-Omar