Bearish Mat Hold Candlestick Formation
Bearish Mat Hold is a bearish trend continuation candlestick pattern indicating continuation of prevailing downtrend even after a temporary halt in the trend (bullish days). It is one of the highly reliable candlestick formations which is rare and is often difficult to identify because of its strong resemblance to Falling Three Methods pattern. Both are five candlestick patterns; the major difference is in middle day candlesticks which are lower (in mat hold) than the counterparts of falling three methods.
The requirements of bearish mat hold candlestick formation includes,
Bearish mat hold formation develops as bulls fail continuously to take prices above the first days range. This greatly enhances the confidence of the bears and prices are then taken to new lows. Although considered as a highly reliable pattern confirmation of trend-continuation is still suggested which can be a low trading gap or bearish candlestick on new day.
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The requirements of bearish mat hold candlestick formation includes,
- The formation should occur in a noticeable downtrend (if not it is considered less-reliable).
- The first day should be a day of high bearish activity with a long bearish (black or colored) candlestick.
- In second day there should be a small-bodied bullish (white or colorless) candlestick which gaps away from the first day candlestick.
- The third and fourth days should be bullish days, and these small bodied candlesticks should stay within the lower range of first day candlestick.
- In fifth day there should be a long bearish candlestick which closes at a new low.
Bearish mat hold formation develops as bulls fail continuously to take prices above the first days range. This greatly enhances the confidence of the bears and prices are then taken to new lows. Although considered as a highly reliable pattern confirmation of trend-continuation is still suggested which can be a low trading gap or bearish candlestick on new day.
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Online Futures Trading, Online Forex Trading
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posted by NobleTrading at
8:51 AM
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