Kathy , here is the target theory for flags. In the diagram I have shown a Bull Flag and a Bear Flag. The sums are the same, but you have to do " takeaways" for the Bear Flag.
Assume the base line is at 000. The length of the pole is 45. We now get a period where you will usually see 3 cycles running between the two parallel down sloping lines. These are the SR lines for the flag. As soon as the first cycle completes, you will know the SR values so you get the value of 15 pretty quickly.By the time the second cycle completes, you can now draw in the "estimated" two parallel lines.From the timescales involved ( minutes to hours/days), you can extrapolate where the 3rd low will be, both in time AND in price.In this "text book" example, we see that the third low occurs at 30. To get our target, we add this pullback value to the pole length, so we get 30 + 45 = 75. This is our Target and we expect the price to get there. Mostly, the momentum will follow the original pole, so we end up with the pole and extension being roughly parallel. We can now track our price against this line. Mostly, hopefully, the target will be met, ie the price will reach 75. As a rule of thumb, allow for a shortfall of 10% in the pole length, in this case 4.5, when deciding if the target is MET or not. If it is met, start looking for clues as to where the next target could be.......
From the diagram, three things are clear:- The shorter the pole length, the LESS the REWARD there will be in the trade. The deeper the 3 cycles, the LESS the REWARD,the steeper the down trend of the 3 cycles, the LESS the REWARD.
Clearly the optimum entry point is the trough on the third cycle.This is the MOST RISKY as there is no guarantee that the flag will break to the upside, yet alone meet the target.On the other hand, you have to balance this against this being the closest you will get to a stop loss, as you will exit if the price then breaks the lower sloping support line. Absolute stop will be at the base line price of 000. In this example ,that's 30 points away! Taking the 3rd trough has another advantage when using SB's. The bias will be in your favour as , in theory,you could get a price of 25 before it turns round and goes North.
Final point, expect a pullback of 20 odd points at or near T1. This, in theory, should give you your next target. Use the same sums and principles to arrive at T2.