bearish harami candlestick

Bearish Harami

• Direction: Bearish
• Type: Reversal
• Reliability: Weak

• First day is long blue candle continuing an established uptrend.

 • Day-two is a small candle or start whose range is within the first days body, above its
midpoint.

Bearish Haramis are characterized by a long blue day followed by a small candle, also refers
to as a star. The trading range of the star stays within the body of the previous days candle.
The significance of this formation is quite clear, as price continues its uptrend it is halted by a
bearish candle.

Bearish Haramis are very weak in signal strength though, since even in a strong bull trend it
is very reasonable to see a sell-off that pulls price back down from highs. Longs paring off
their exposure may cause this. Thus candlestick analysts will watch for bearish days to
come, but probably not bet on them.

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Harami
The Harami (meaning "pregnant" in Japanese) Candlestick Pattern is a reversal pattern. The
pattern consists of two Candlesticks:

• Larger Bullish or Bearish Candle (Day 1)

• Smaller Bullish or Bearish Candle (Day 2)
The Harami Pattern is considered either bullish or bearish based on the criteria below:

Bearish Harami : occurs when there is an original bull mkt .A bearish Harami occurs when
there is a large bullish green candle on Day 1 followed by a smaller bearish or bullish candle
on Day 2. The most important aspect of the bearish Harami is that prices gapped down on Day
2 and were unable to move higher back to the close of Day 1. This is a sign that uncertainty is
entering the market.

Bullish Harami: occurs when there has been an original bear market. A bullish Harami
occurs when there is a large bearish red candle on Day 1 followed by a smaller bearish or
bullish candle on Day 2. Again, the most important aspect of the bullish Harami is that prices
gapped up on Day 2 and price was held up and unable to move lower back to the bearish close
of Day 1.

Harami Candlestick Chart Example

The chart below of the Nasdaq 100 E-mini Futures contract shows an example of both a bullish
and bearish Harami candlestick pattern:
The first Harami pattern shown above on the chart of the E-mini Nasdaq 100 Future is a
bullish reversal Harami. First there was a long bearish red candle. Second, the market gapped
up at the open. In the case above, Day 2 was a bullish candlestick, which made the bullish
Harami even more bullish.

Harami Candlestick Buy Signal

A buy signal could be triggered when the day after the bullish Harami occured, price rose
higher, closing above the downward resistance trendline. A bullish Harami pattern and a
trendline break is a potent combination resulting in a strong buy signal.

The second Harami pattern shown above on the chart of the E-mini Nasdaq 100 Future is a
bearish reversal Harami. The first candle was a long bullish green candle. On the second
candle, the market gapped down at the open. The chart above of the e-mini shows that Day 2
was a bearish candlestick; this made the bearish Harami even more bearish.

Harami Candlestick Sell Signal

A sell signal could be triggered when the day after the bearish Harami occured, price fell even
further down, closing below the upward support trendline. When combined, a bearish Harami
pattern and a trendline break is a strong indication to sell.

A somewhat opposite two candlestick reversal pattern is the Bearish Engulfing Pattern (see:
Bearish Engulfing Pattern) and the Bullish Engulfing Pattern (see: Bullish Engulfing Pattern).