Stock Market Paradox

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Unlock Momentum with the Rare, Powerful High-Tight Flag Pattern
ZACKSยท 2025-09-15 22:01
Core Insights - William O'Neil is recognized for combining fundamental and technical analysis to gain market advantages [1] - O'Neil's "stock market paradox" suggests that stocks perceived as high-risk often continue to rise, while those seen as low-risk may decline [2] - The "high-tight flag" pattern is a technical analysis tool that indicates strong bullish demand and limited selling pressure [3][4] High-Tight Flag Pattern Characteristics - The "pole" of the pattern requires a stock to double in value within eight weeks, indicating significant accumulation [3] - The "flag" involves a pullback of 3 to 5 weeks, not exceeding 25% from the peak, with reduced trading volume [4] - A fundamental catalyst, such as a new product or earnings beat, is essential for a stock to qualify as a high-tight flag [5] Historical Examples of High-Tight Flags - Tesla (TSLA) formed a high-tight flag in 2013 after reporting its first quarterly profit, leading to a near doubling of its stock price [6] - Axon (AXON), previously known as Taser, experienced a significant rise from $1 to $60 in under two years due to police contracts in 2003 [8] - Qualcomm (QCOM) built a textbook high-tight flag in 1999, doubling in value within four weeks, driven by multiple fundamental catalysts [10] 2025 High-Tight Flag Candidates - iShares Ethereum ETF (ETHA) has shown potential by rising from $18 to $37 in eight weeks, indicating a classic high-tight flag pattern [12][13] - Nebius Group (NBIS) recently doubled its shares after securing a $17 billion AI data center contract with Microsoft (MSFT), marking a significant catalyst for growth [15][16]