1. Bullish Harami Pattern: A bullish harami pattern is a two-candlestick pattern that occurs during a downtrend. The first candle is a large bearish (red or black) candle, representing selling pressure. The second candle is a small bullish (green or white) candle that is completely engulfed within the body of the first candle. The second candle indicates a decrease in selling pressure and a potential trend reversal, suggesting that buyers may be entering the market.
Key characteristics of a bullish harami pattern are as follows:
The first candle is bearish and larger in size.
The second candle is bullish and smaller, completely contained within the range of the first candle.
It indicates a potential weakening of the bearish momentum and a possible trend reversal.
2. Bearish Harami Pattern: A bearish harami pattern is a two-candlestick pattern that occurs during an uptrend. The first candle is a large bullish (green or white) candle, representing buying pressure. The second candle is a small bearish (red or black) candle that is completely engulfed within the body of the first candle. The second candle indicates a decrease in buying pressure and a potential trend reversal, suggesting that sellers may be entering the market.
Key characteristics of a bearish harami pattern are as follows:
The first candle is bullish and larger in size.
The second candle is bearish and smaller, completely contained within the range of the first candle.
It indicates a potential weakening of the bullish momentum and a possible trend reversal.
Both bullish harami and bearish harami patterns suggest a potential trend reversal, but it is important to confirm these patterns with additional technical analysis tools and indicators before making trading decisions. These patterns provide initial signals that warrant further analysis of the market conditions.
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