Pathshala: Bearish High Reliability Reversal Candlestick Patterns

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<span style="font-size: large;"><u><span style="color: red;"><span style="font-family: "arial" , "helvetica" , sans-serif;"><b>Bearish High Reliability  Reversal Candlestick Patterns</b></span></span></u></span><br />
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<b><span style="color: red;"><span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;">1) Bearish Dark Cloud Cover,  </span></span></span></b><b><span style="color: red;"><span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;">2) Bearish Kicking,  3) </span></span></span></b><b><span style="color: red;"><span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;">Bearish Abandoned Baby, </span></span></span></b></div>
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<b><span style="color: red;"><span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;">4) Bearish Evening Star,  </span></span></span></b><b><span style="color: red;"><span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;">5) Bearish Three Black Crows,  </span></span></span></b><b><span style="color: red;"><span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;">6) Bearish Three Inside Down, 7) Bearish Three Outside Down,  </span></span></span></b><b><span style="color: red;"><span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;">8) Upside Gap Two Crows. </span></span></span></b></div>
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<span style="color: red;"><b><span style="font-family: "arial" , "helvetica" , sans-serif;"><span style="font-size: large;">1. Bearish Abandoned Baby</span></span></b></span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjVvwytIwlfiOuXwKHX4_uxp5ZEQtzEGp6IXtNnl86c5hNL9oOhXIR729ps5nOmhMzflvIA_wxGU0NpJS942uBkps-g0jLGN1GyNA53DWzjw6YOjutRAtb0nqI_MSAWqSF7zqEAkqqGhao/s1600/bearishabandonedbaby1.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="175" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjVvwytIwlfiOuXwKHX4_uxp5ZEQtzEGp6IXtNnl86c5hNL9oOhXIR729ps5nOmhMzflvIA_wxGU0NpJS942uBkps-g0jLGN1GyNA53DWzjw6YOjutRAtb0nqI_MSAWqSF7zqEAkqqGhao/s320/bearishabandonedbaby1.jpg" width="191" /></a></div>
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<b><span style="font-family: "arial" , "helvetica" , sans-serif;"></span></b><span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">Pattern:</span>  reversal<br />
 <span class="bodybldblue">Reliability:</span> high </b><br />
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 <b><span class="bodybldblue">Identification</span></b><br />
 A long white day is followed by a Doji that gaps in the direction of 
the trend. Then a black day occurs gaping in the opposite direction 
with no overlapping shadows.
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<span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">The Psychology</span></b><br />
 In an uptrend or within a bounce of a downtrend, the market gaps up but
 does not continue it's upward movement. Instead enough bears step in to
 bring supply and demand back into equilibrium and the stock churns in 
place. This isn't necessarily bearish, but it's certainly less bullish. 
The pattern is confirmed by the next day's gap down and drop.</span>
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 The bearish Abandoned Baby formation doesn't occur too often and is similar to the bearish Doji Star, bearish Evening Star, and bearish Evening Doji Star. </span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;">If you can handle the volatility, DAL provided a decent entry on a short
 when the stock formed a bearish Abandoned Baby formation at resistance.
 If this pattern had formed in a steady uptrend, it would be very risky,
 but given that it formed at a previous high, the reliability of the 
pattern increases. </span></div>
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<span style="color: red;"><b><span style="font-size: large;"><span style="font-family: "arial" , "helvetica" , sans-serif;">2. Bearish Three Black Crows</span></span></b></span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh5GYqBGMxKipCLHo-s5wS3wW8J3Kut4blOP2L86yZoFy7bCzpWU0ZmUxQ7dAw7gCVwh2SEqro888K18usj7h4ObOjvkDd3iQL8Ek1YxwHt_pN6DoxCrl8Zrx4BrQOObbIONavXHnyENbI/s1600/threeblackcrows.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="165" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh5GYqBGMxKipCLHo-s5wS3wW8J3Kut4blOP2L86yZoFy7bCzpWU0ZmUxQ7dAw7gCVwh2SEqro888K18usj7h4ObOjvkDd3iQL8Ek1YxwHt_pN6DoxCrl8Zrx4BrQOObbIONavXHnyENbI/s320/threeblackcrows.jpg" width="166" /></a><b><span style="font-size: large;"><span style="font-family: "arial" , "helvetica" , sans-serif;"></span></span></b><span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">Pattern:</span>  reversal<br />
 <span class="bodybldblue">Reliability:</span> high</b><br />
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 <b><span class="bodybldblue">Identification</span></b><br />
 Three long black days occur with each successive open being within the 
body of the previous day and each successive close being below the 
previous day's and near the day's low. <br /> </span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">The Psychology</span></b><br />
  In an uptrend or within a bounce of a downtrend, the three long black 
candles speak for themselves. If volume accompanies the move, the 
reliability of the pattern increases significantly. </span>
  <span style="font-family: "arial" , "helvetica" , sans-serif;"><br />
  The bearish Three Black Crows is similar to the bearish Identical Three Crows, bullish Concealing Baby Swallow, bullish Ladder Bottom and bullish Three Stars in the South and could be the beginning of the bearish Three Line Strike.  </span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;">BMC presented a more favorable way to play a bearish Three Black Crows 
formation. The third candle also broke support. That's a nice one-two 
combination and because the prudent trader will often wait until support
 it taken out, you don't feel like you are chasing the play. </span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Here's an example of a bearish Three Black Crows pattern that failed 
miserably...and it formed at resistance (40). They don't always work!!</span><br />
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<span style="color: red;"><b><span style="font-size: large;"><span style="font-family: "arial" , "helvetica" , sans-serif;">3. Bearish  Evening Star</span></span></b></span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjYNjrxT8QhOrjqs5SKCt6kiSG3_wFu4A3QkkgEB__rsIJZkTrtEY-bwcJ5dppDqQJpHmzkM8pPFZha5ZwF98ZJfSmNpzCysUhA9_Wy1CV2Gqr6HqZpCKbyPq-vadT7TL0DND3ViJKP4ao/s1600/eveningstar.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="190" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjYNjrxT8QhOrjqs5SKCt6kiSG3_wFu4A3QkkgEB__rsIJZkTrtEY-bwcJ5dppDqQJpHmzkM8pPFZha5ZwF98ZJfSmNpzCysUhA9_Wy1CV2Gqr6HqZpCKbyPq-vadT7TL0DND3ViJKP4ao/s320/eveningstar.jpg" width="169" /></a><span style="color: red;"><b><span style="font-size: large;"><span style="font-family: "arial" , "helvetica" , sans-serif;"></span></span></b></span><span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">Pattern:</span>  reversal<br />
 <span class="bodybldblue">Reliability:</span> high <br />
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 <span class="bodybldblue">Identification</span></b><br />
 A long white day is followed by a small body that gaps in the direction
 of the trend. The third day is a black day that closes in the bottom 
half of the white candle. <br /> </span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">The Psychology</span></b><br />
  In an uptrend or within a bounce of a downtrend, the market gaps up 
but does not continue its upward movement. Instead enough bears step up 
to bring supply and demand back into equilibrium so a small body forms. A
 subsequent follow through gap down that closes below the midpoint of 
the white day completes the pattern and confirms the reversal. </span>
  <span style="font-family: "arial" , "helvetica" , sans-serif;"><br />
  The bearish Evening Star is similar to the bearish Evening Doji Star, bearish Abandoned Baby, bearish Doji Star, bearish Two Crows, and bearish Upside Gap Two Crows. </span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;">GFF was in a steady uptrend when it formed an Evening Star pattern at an
 area that was previously established as possible resistance. Coupled 
with confirmation from one or two technical indicators, this reversal 
pattern is very reliable – especially when it forms at a previous high. </span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgP5gbmu92oHJqNb4HbiyLwrhK8FTa9aAmdrNLA79-I-qVVrJe9nbyy-DuNZmoKPxy5gZE1WOezguGvAflOVN_6bTwohMwJbczEffHcxR0dlpd5UF0IfknBMgEjuhx9EQIBy-TbO0dNiQk/s1600/5.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="351" data-original-width="560" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgP5gbmu92oHJqNb4HbiyLwrhK8FTa9aAmdrNLA79-I-qVVrJe9nbyy-DuNZmoKPxy5gZE1WOezguGvAflOVN_6bTwohMwJbczEffHcxR0dlpd5UF0IfknBMgEjuhx9EQIBy-TbO0dNiQk/s1600/5.PNG" /></a></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Here is somewhat of a hap-hazard play. AMTD gapped up on big volume and 
immediately formed a bearish Evening Star pattern, and the stock turned 
right around and started a steady decline. </span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;"><span style="color: red;"><b><span style="font-size: large;">4. Bearish Dark Cloud Cover </span></b></span></span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgZgQpMCkDNuL83ZmcdnuloJavqw3SQc6iQ7kwwQZkTCAqugMI1GGIwKEDHkiFVk9_dvdyzoi30XIOzGorE7KZfQi425n2sdMz-G5jnjBiynpBX5AGb-oKj8nECTwQdyprmibS8DjWsimI/s1600/darkcloudcover.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="183" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgZgQpMCkDNuL83ZmcdnuloJavqw3SQc6iQ7kwwQZkTCAqugMI1GGIwKEDHkiFVk9_dvdyzoi30XIOzGorE7KZfQi425n2sdMz-G5jnjBiynpBX5AGb-oKj8nECTwQdyprmibS8DjWsimI/s320/darkcloudcover.jpg" width="188" /></a><span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">Pattern:</span>  reversal<br />
 <span class="bodybldblue">Reliability:</span> high <br />
 <br />  
 
  
 <span class="bodybldblue">Identification</span></b><br />
 A long white day is followed by a black day which gaps above the high 
of the white candle and then closes below the midpoint of the first 
day's body.
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<span style="font-family: "arial" , "helvetica" , sans-serif;"><span style="font-size: small;"><b><span class="bodybldblue">The Psychology</span></b><br />
  In an uptrend or within a bounce of a downtrend, the stock gaps up and
 immediately encounters sellers who push the stock back down. This 
simply signifies the possibility of a reversal that is more reliable if 
the gap up occurs at resistance and the black day is accompanied by a 
surge in volume. </span><span style="font-size: small;"><br />
  The bearish Dark Cloud Cover is similar to the bearish Engulfing. </span></span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Here is an example of a Dark Cloud Cover candle formation occurring at 
resistance. In a steady uptrend, playing this pattern for a reversal is 
risky, but when the pattern forms at resistance, the odds favor a 
successful result. </span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;">WEDC formed a bearish Dark Cloud Cover candle right at a previous high 
and began a tradable leg down. When this candle forms at resistance, 
your risk declines on a the short side. </span><br />
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<span style="font-size: large;"><span style="color: red;"><b>5.</b></span> <b><span style="color: red;">Bearish Kicking</span></b></span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjr9U_CCQDY1NjCAttASqy7l7dCkyXQnC3pMxda2PvRzOa77p6ZZfLiPud81sEQBy6M8PiToD6lnbgIwFqAhZrXvpVGLcRF-M_NXY3H6uLJl93Qhd_8m7Sy8DBpSPQt1UtOW7DKWILK4Y4/s1600/bearishkicking.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="183" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjr9U_CCQDY1NjCAttASqy7l7dCkyXQnC3pMxda2PvRzOa77p6ZZfLiPud81sEQBy6M8PiToD6lnbgIwFqAhZrXvpVGLcRF-M_NXY3H6uLJl93Qhd_8m7Sy8DBpSPQt1UtOW7DKWILK4Y4/s320/bearishkicking.jpg" width="186" /></a><b><span style="font-family: "arial" , "helvetica" , sans-serif;"><span class="bodybldblue">Pattern:</span> reversal </span>
 <span style="font-family: "arial" , "helvetica" , sans-serif;"><span class="bodybldblue">Reliability:</span> high </span>
 <span style="font-family: "arial" , "helvetica" , sans-serif;"><br /></span> 
  
 </b><span style="font-family: "arial" , "helvetica" , sans-serif;"><span class="bodybldblue"><b>Identification</b><br />
 </span>A White Marubuzo (opens at low and closes at high) is followed 
by a Black Marubuzo (opens at high and closes at low) that gaps down. </span> <br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">The Psychology</span></b><br />
 A big black candle that opens at its high and closes at the day's low 
is bearish regardless of the overall trend. Volume confirmation on the 
black day solidifies the patter as is a follow up weak day. </span>
 <span style="font-family: "arial" , "helvetica" , sans-serif;"><br />
 The bearish Kicking is similar to the bearish Separating Lines.  </span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;"><span style="background-color: #f7f7f7; text-align: start;"><b><i><u>The pattern is extremely rare, especially in the liquid markets</u></i></b></span></span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><span style="background-color: #f7f7f7; font-family: "Open Sans"; font-size: 14px; text-align: start;"><br /></span></span>
<div style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">
<strong>Recognition Criteria:</strong></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"><span style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">1. Market direction is not important.</span><br style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;" /><span style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">2. We see a White Marubozu in the first day.</span><br style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;" /><span style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">3. Then we see Black Marubozu day that gaps downward on the second day.</span><br style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;" /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhh5JTWhHFQs_abiRYZ8lJl9Ty_9nUw3BET88vRRVJ2BVGkqjWycSThfb1Vx6rShGD1GHWG1qjcvl-RCA_UXR2GGEfbOLqevBSnNE3xdLqfuPOC_-Zwygr3Mq2NhkRrQghvn_hpfb9r8eM/s1600/BearKicking.JPG" imageanchor="1" style="font-family: "Times New Roman"; margin-left: 1em; margin-right: 1em; text-align: center;"><img border="0" height="248" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhh5JTWhHFQs_abiRYZ8lJl9Ty_9nUw3BET88vRRVJ2BVGkqjWycSThfb1Vx6rShGD1GHWG1qjcvl-RCA_UXR2GGEfbOLqevBSnNE3xdLqfuPOC_-Zwygr3Mq2NhkRrQghvn_hpfb9r8eM/s320/BearKicking.JPG" width="459" /></a></span><br />
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<div style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">
<strong>Explanation:</strong></div>
<div style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">
Bearish Kicking Pattern sends a strong signal suggesting that the market is now heading downward. The previous market direction is not important in this pattern unlike most other candlestick patterns. The market has been in a trend when prices gap down the next day in case of Bearish Kicking Pattern. The prices on the second day never enter into the previous day's range and we have a close with another gap.</div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBEzgWRGyzWKrPJZNjtKj7EP1gQm54m5XEWHoFXVzVIqfZ2G2mlEhui1iDu_STMWoWbSnLpO-sYtKl8tgdzrSJpMJp1ZPESLUqZESGmGpVqz3DZhYb8oIs-QOpyT-CYXY27YWVXQ_mqpM/s1600/8.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="350" data-original-width="560" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBEzgWRGyzWKrPJZNjtKj7EP1gQm54m5XEWHoFXVzVIqfZ2G2mlEhui1iDu_STMWoWbSnLpO-sYtKl8tgdzrSJpMJp1ZPESLUqZESGmGpVqz3DZhYb8oIs-QOpyT-CYXY27YWVXQ_mqpM/s1600/8.png" /></a></div>
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<div style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">
<strong>Important Factors:</strong></div>
<div style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">
Both of the candlesticks do not have shadows (or very small shadows if any). In other words both are Marubozu.</div>
<div style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">
The Bearish Kicking Pattern is similar to the Bearish Separating Lines Pattern except that instead of the open prices being equal, in the Bearish Kicking Pattern a gap occurs.</div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="font-family: Verdana, Arial, Helvetica; font-size: 13.3333px; text-align: start;">
The Bearish Kicking Pattern is highly reliable but still a confirmation may be necessary, and this confirmation may be in the form of a black candlestick, a large gap down or a lower close on the next trading day.</div>
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<span style="color: red;"><b><span style="font-size: large;"><span style="font-family: "arial" , "helvetica" , sans-serif;">6. Bearish Three Inside Down</span></span></b></span><br />
<br />
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiRIF2ckfLsYrrbFdOKd58s-6BU_9JFeWbyfIBL7UeN0NL2Z0xeG44dUB7a13Dryeg12q8z5AKT7QoUNjKe3Cb3l1lHuHXu-hMl8U32wIxVkI1TeRToxHxZk1Qz9MTBaV6iB1mpK0JCEoo/s1600/bearishthreeinsidedown.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="182" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiRIF2ckfLsYrrbFdOKd58s-6BU_9JFeWbyfIBL7UeN0NL2Z0xeG44dUB7a13Dryeg12q8z5AKT7QoUNjKe3Cb3l1lHuHXu-hMl8U32wIxVkI1TeRToxHxZk1Qz9MTBaV6iB1mpK0JCEoo/s320/bearishthreeinsidedown.jpg" width="187" /></a><b><span style="font-family: "arial" , "helvetica" , sans-serif;"><span class="bodybldblue">Pattern:</span>  reversal</span>
 <span style="font-family: "arial" , "helvetica" , sans-serif;"><span class="bodybldblue">Reliability:</span> high</span>
 <span style="font-family: "arial" , "helvetica" , sans-serif;"><br /></span>  
 
  
 </b><span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">Identification</span></b><br />
 A bearish Harami pattern is followed by a black day whose close is lower than the second day. </span> <br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">The Psychology</span></b><br />
  In an uptrend or within a bounce of a downtrend, a bearish Harami 
forms. By itself this pattern has moderate reliability as a reversal 
pattern, but when followed by a weak day (preferably with a pick up in 
volume) the overall pattern becomes much more reliable. </span>
  <span style="font-family: "arial" , "helvetica" , sans-serif;"><br />
  The bearish Three Inside Down is a continuation of the bearish Harami.</span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhmuDL_b-KFwyK-8CeRisrHnNsThgvypOrRWGnhMvs0RxETX5L1mF4jViIvPj4nZsZfld2IVBibGMmu6sWIvrKUURTyGOaL2_LYNBg2-TfRo_tRJ-7lZEdz-2KHShFJejG_5eUcdWEvJ8g/s1600/9.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="350" data-original-width="560" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhmuDL_b-KFwyK-8CeRisrHnNsThgvypOrRWGnhMvs0RxETX5L1mF4jViIvPj4nZsZfld2IVBibGMmu6sWIvrKUURTyGOaL2_LYNBg2-TfRo_tRJ-7lZEdz-2KHShFJejG_5eUcdWEvJ8g/s1600/9.PNG" /></a></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"><br /></span>
<span style="font-family: arial, helvetica, sans-serif; text-align: center;">DRD was in a steady uptrend, but the mid-September attempt at a higher 
high failed and resulted in a bearish Three Inside Down candle formation
 which reversed the uptrend.  </span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;"> Look below chart SFD collapsed on huge volume in late June. The stock then experienced an
 oversold bounce which ended in a bearish Three Inside Down pattern. </span></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgMsVgYpFT0X-npQcokdOtrTNyOQpZJ9PKLyi0xbUh4bWLgKbkPWllFKNGHyrN9sQG1QiOERjXxkViGp8dH2W3D2vn2wX2_3c58d78dELCU58rmH-Uz78Km1pWrtwKRiiKV6uHcaqSkYpg/s1600/10.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="350" data-original-width="560" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgMsVgYpFT0X-npQcokdOtrTNyOQpZJ9PKLyi0xbUh4bWLgKbkPWllFKNGHyrN9sQG1QiOERjXxkViGp8dH2W3D2vn2wX2_3c58d78dELCU58rmH-Uz78Km1pWrtwKRiiKV6uHcaqSkYpg/s1600/10.PNG" /></a></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi9PMi4npEN6eHrRuZYhjgsfXGDChXSNsrfmGDQ0qMx45D1Kqio-_qsymdkCHocYqk6nQRnhCTdVouFX9f7hGaE558lMimFYFTbjxFXoEemxQd9lbKFSNXluAwZ3HBljDOJFeZnUu2nsBA/s1600/11.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="350" data-original-width="560" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi9PMi4npEN6eHrRuZYhjgsfXGDChXSNsrfmGDQ0qMx45D1Kqio-_qsymdkCHocYqk6nQRnhCTdVouFX9f7hGaE558lMimFYFTbjxFXoEemxQd9lbKFSNXluAwZ3HBljDOJFeZnUu2nsBA/s1600/11.PNG" /></a></div>
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<span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;">Here is an example of when not to play a bearish Three Inside Down 
formation. LFG has just made a higher high on better than average 
volume. The candle pattern was just a pause in an uptrend...not a reason
 to go short.</span></span></div>
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<span style="color: red;"><b><span style="font-size: large;"><span style="font-family: "arial" , "helvetica" , sans-serif;">7. Bearish Three </span></span></b></span><span style="color: red;"><b><span style="font-size: large;"><span style="font-family: "arial" , "helvetica" , sans-serif;">Outside Down</span></span></b></span></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEipdVQ-t8SGF00hIdqOo9EtYfR63C_CImrHfWSJN8rzWusGpbOXdldxgCdrsZap2Z6kbYQBe_mihpid3_j_we_f_OJ3CPrYb-4rebLMp8D5SrkvYI5eaJfN6Xqb-64GOy_kmlAXNEsft5s/s1600/threeoutsidedown.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="190" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEipdVQ-t8SGF00hIdqOo9EtYfR63C_CImrHfWSJN8rzWusGpbOXdldxgCdrsZap2Z6kbYQBe_mihpid3_j_we_f_OJ3CPrYb-4rebLMp8D5SrkvYI5eaJfN6Xqb-64GOy_kmlAXNEsft5s/s320/threeoutsidedown.jpg" width="177" /></a><span style="color: red;"><b><span style="font-size: large;"><span style="font-family: "arial" , "helvetica" , sans-serif;"></span></span></b></span><span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">Pattern:</span>  reversal<br />
 <span class="bodybldblue">Reliability:</span> high<br />
 <br />  
 
  
 <span class="bodybldblue">Identification</span></b><br />
 A bearish Engulfing pattern is followed by a black day whose close is lower than the second day. <br /> </span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">The Psychology</span></b><br />
  In an uptrend or within a bounce of a downtrend, a bearish Engulfing 
pattern forms. By itself this pattern has moderate reliability as a 
reversal indicator, but when the it is followed by another black day 
(preferably on strong volume), the overall pattern becomes much more 
reliable. </span>
  <span style="font-family: "arial" , "helvetica" , sans-serif;"><br />
  The bearish Three Outside Down is a continuation of the bearish Engulfing. </span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgjbp-WYcLXlOueF9VsqSkeaKditzbU7QBhEuavv4dBoPihtoSiqp2LsePvVMQgGCbLZj_0UWv2et8fGaL75adOarei356BugHBdwGM9v2Z9FDFle7mx6eiXRhgEups2YRAAoxc_wBvyJY/s1600/12.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="350" data-original-width="560" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgjbp-WYcLXlOueF9VsqSkeaKditzbU7QBhEuavv4dBoPihtoSiqp2LsePvVMQgGCbLZj_0UWv2et8fGaL75adOarei356BugHBdwGM9v2Z9FDFle7mx6eiXRhgEups2YRAAoxc_wBvyJY/s1600/12.PNG" /></a></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Here is another reliable scenario. Although NTAP was in a decent 
uptrend, the stock formed a bearish Three Outside Down pattern and broke
 support at the same time. That's a nice one-two punch. </span></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjkMVOSK9wPM_QwHNx7Hv39LrDxY6ns8nyP8lJfkwgEsHvDAZOqK6NjN7AhNQ06kbQdTGQ-OePYvciYSwkFwUkaHZKIeVe0Wpsrm-ksB_1KJIGjKAzr1IjXPHafuli33_uEjyOelYWF-qA/s1600/13.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="350" data-original-width="560" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjkMVOSK9wPM_QwHNx7Hv39LrDxY6ns8nyP8lJfkwgEsHvDAZOqK6NjN7AhNQ06kbQdTGQ-OePYvciYSwkFwUkaHZKIeVe0Wpsrm-ksB_1KJIGjKAzr1IjXPHafuli33_uEjyOelYWF-qA/s1600/13.PNG" /></a></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">SINA is an example of the riskiest way to play this formation. The stock
 was generally in a good uptrend with no noticeable resistance nearby. 
The Three Outside Down pattern did mark the end of the rally, but given 
the lack of overhead resistance, it was a riskier play.  </span></div>
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<span style="color: red;"><span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span style="font-size: large;">8.  Bearish Upside Gap Two Crows</span></b></span></span></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEisXn-Uuux-jbe3ZnllLXaqWb-XP5AvxM7CLoLDfYWH_HkccUsPWUYouYufVzkXXu0dsmhNBSCAPNFlNdCHM2Hmf4Pj4kQc_jha8ZD1g0Aq3e037O1Nsly0_1oxBsHQL-su1ArKwmt1_jI/s1600/upsidegaptwocrows1.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="177" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEisXn-Uuux-jbe3ZnllLXaqWb-XP5AvxM7CLoLDfYWH_HkccUsPWUYouYufVzkXXu0dsmhNBSCAPNFlNdCHM2Hmf4Pj4kQc_jha8ZD1g0Aq3e037O1Nsly0_1oxBsHQL-su1ArKwmt1_jI/s320/upsidegaptwocrows1.jpg" width="189" /></a><span style="color: red;"><span style="font-family: "arial" , "helvetica" , sans-serif;"></span></span><span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">Pattern:</span>  reversal<br />
 <span class="bodybldblue">Reliability:</span> high <br />
 <br />  
 
  
 <span class="bodybldblue">Identification</span></b><br />
 A long white day is followed by a black candle which gaps in the 
direction of the trend. The final day engulfs the small black day and 
closes within the gap of the first two days. <br /> </span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"><b><span class="bodybldblue">The Psychology</span></b><br />
  In an uptrend or within a bounce of a downtrend, successive gaps up 
which close down to force a black candle to form suggests the bulls are 
weaken. They are not able to rally the stock intraday and the bears are 
starting to take over. The reliability of the increases if the gaps up 
bump into resistance. </span>
  <span style="font-family: "arial" , "helvetica" , sans-serif;"><br />
  The bearish Upside Gap Two Crows is similar to the bearish Two Crows and bearish Evening Star. </span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiDMEsyNqIQR_CyI_wIzHkgizvfWumSjCQA2Ly_1exYmoYY0m9N7GQWWRd4s0eM1VqSBDioUMX8ut1HlN8bxsVYI9Rg4ddOd0SWWILLhtlI55YJxZc5R8oGGglg6QLwPh8JwnceS5A5v_c/s1600/14.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="350" data-original-width="550" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiDMEsyNqIQR_CyI_wIzHkgizvfWumSjCQA2Ly_1exYmoYY0m9N7GQWWRd4s0eM1VqSBDioUMX8ut1HlN8bxsVYI9Rg4ddOd0SWWILLhtlI55YJxZc5R8oGGglg6QLwPh8JwnceS5A5v_c/s1600/14.PNG" /></a></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Here is an example of reversal pattern that would be better used to exit
 a long position rather than initiating a short. After all, the stock 
had just bounced on big volume. The prudent trader would look to exit a 
long position and then rebuy the dip. </span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><span style="font-size: small;"> 
  </span></span><br />
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Bearish High Reliability Reversal Candlestick Patterns 45. Bearish High Reliability Reversal Candlestick Patterns

Bearish High Reliability Reversal Candlestick Patterns 1) Bearish Dark Cloud Cover, 2) Bearish Kicking, 3) Bearish Abandoned Bab...