Japanese Candlestick Analysis
upside tasuki gapfigure 14.40 A Tasuki Upside Gap Formation.Description:■ (^) The upside Tasuki gap is a multiple candlestick continuation pattern. See
Figure 14.40.
■ (^) The first candlestick should be a strong bullish candlestick. A second small
real‐bodied candlestick gaps up and opens above the first candlestick. This is
followed by a third small real‐bodied bearish candlestick opening within the
second candlestick and closing below the second candlestick, but above the
first candlestick.
■ (^) The upper and lower shadows are not significant.
■ (^) It is best found in an uptrend that is beginning to display strength.
■ (^) Its corresponding bearish version is the downside Tasuki gap.
Psychology:
■ (^) The upside Tasuki gap is a bullish formation. The buyers, who are in control,
drive prices up in an existing uptrend, with a long white candlestick appearing.
Buyers drive prices up aggressively as evidenced by a second small real‐bodied
candlestick gapping above the first candlestick. The sellers try to take control,
but are unable to drive prices down to the top of the first candlestick. The buy-
ers finally resume control by driving prices above the highest high of the two
small real‐bodied candlestick formations. The bulls are now in control.
Trigger, Stoploss, and Confirmation:
■ (^) The trigger is at the high of the second candlestick.
■ (^) To confirm the reversal, price needs to close above this trigger level.