Japanese Candlestick Analysis
figure 14.30 Color Independence of Bullish Harami Formations.some bullish reversal Candlestick patterns
In this section we shall examine a few popular bullish reversal candlestick patterns.
We shall be looking at their construction, potential trigger levels, penetration can-
dlestick, pattern confirmation, and stoploss placements levels. For a summary of
more candlesticks and their properties, refer to Appendix A.bullish haramiDescription:■ (^) The bullish Harami formation is a double candlestick reversal pattern. See
Figure 14.30.
■ (^) The first candlestick may be either a strong bullish or bearish candlestick,
followed by a small‐bodied candlestick like a spinning top gapping into the
range of the first candlestick. The second small‐bodied candlestick can be of
any color as well.
■ (^) The upper and lower shadows are not significant.
■ (^) It is best found in a protracted downtrend that is beginning to display weakness.
■ (^) Its corresponding bearish version is the bearish Harami formation.
Psychology:
■ (^) The bullish Harami formation begins as either a bullish or bearish candle-
stick. The price suddenly gaps into the range of the first candlestick and halts,
indicating that the buyers are now at play in the existing downtrend. Eventu-
ally the buyers take over by driving price up above the high of the first candle-
stick, showing that the bulls are now in control.