Bullish Harami Pattern
A Japanese candlestick chart pattern that forms when a large black candlestick is followed by a smaller candlestick whose body is located within the real body of the first candlestick. This trend suggests that the bulls have taken control of price movement from the bears. This type of pattern usually accompanies a declining trend, suggesting that a reversal may be occurring. With Forex trading, gaps are rare from candlestick to candlestick, so the close of the first candlestick may equal the open of the second candlestick.
Forex Bullish Harami PatternThe Bullish Harami is a two candlestick pattern forming in a down trending price pattern.
The body of the first candlestick is the same color as the current trend and should be a long black candlestick.
The body of the second candlestick is white and opens and closes within the body of previous day’s candle. However, with Forex, the open may be at the same price as the close of the previous candlestick.
Rules:
The down trend has been fairly consistent for a period of time. A long black candlestick occurs at the end of the trend.
The body of the first candlestick is long and black.
The body of the second candlestick is white.
The second day opens higher than or equal to the close of the previous candlestick and closes lower than the open of the prior candlestick. (i.e. the body of the second candlestick is contained entirely within the body of the first candlestick).
Further confirmation is strongly suggested to indicate a reversal signal. The Bullish Harami Pattern is a good indication of a possible reversal, pending confirmation. Wait another day. A confirmation may come in the form of a Three Inside Up pattern.
Signal Strengtheners:
The longer the black candle, the more potential of a reversal occuring.
The higher the white candle closes up on the black candle, the more likely that a reversal has occurred despite the size of the white candle.
The higher volue during the Harami period, the more likely a reversal is occuring due to swapping positions.