This is a major bullish reversal pattern, which is even more significant than a regular Bullish Harami.
A bearish mood prevails in the market, and a downtrend is in progress. The first day’s candlestick is a black body, which further supports bearishness. However the next day, prices open higher than the close, or at the close of the preceding day.
The short traders are alarmed which leads to the covering of many short positions, causing the price to rise further.
Moreover, the day closes at the opening price, showing lack of decision among traders. The increasing level of indecision and uncertainty amplifies the likelihood of a trend change and cause a reversal.
MTM Price at posting:
11.5¢ Sentiment: Buy Disclosure: Held
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