- Sentiment: Bearish
- No. of candles: 1
- Direction: Continuation
What Is The Bearish Marubozu Japanese Candlestick Pattern?
The Bearish Marubozu pattern is a bearish continuation pattern that indicates strong selling pressure throughout the period.
The Japanese candlestick pattern consists of a single candle. This candle has a long bearish body with little or no shadow on either end, indicating that the opening price was the same as the high price and the closing price was the same as the low price.
What Is The Psychology Behind The Bearish Marubozu Pattern?
The Bearish Marubozu pattern reflects a strong bearish sentiment in the market, with sellers in control throughout the entire period.
The lack of any shadow on either end of the candle signifies that the sellers have remained in control, and there has been no buying pressure. This pattern indicates a possible continuation of the bearish trend.
Japanese Candlestick Charting Techniques, Second Edition
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To trade the Bearish Marubozu pattern, look for confirmation by a subsequent bearish candle or another technical indicator.
The sell trigger occurs when the price moves and closes below the low of the candle, confirming the pattern.
Place a stop loss order above the high of the candle to protect against potential false breakouts or reversals.
As the price moves in your favor, consider using trailing stops or other risk management techniques to lock in profits and minimize potential losses.
Additional Tips
While the Bearish Marubozu pattern can be a reliable bearish continuation signal, it is essential to use it in conjunction with other technical indicators and chart patterns to confirm the trend change.
Additionally, be aware of the overall market context and consider factors such as support and resistance levels, as well as the strength of the prevailing trend.
Keep in mind that no single pattern can guarantee a trend continuation, and proper risk management is always necessary.
Continue to learn about Japanese candlesticks through books, such as Steve Nison’s “Japanese Candlestick Charting Techniques” and “Beyond Candlesticks.”