Stick Sandwich |
Characteristic of Candlesticks: Reversal
Relevance of Candlesticks: Bullish
Prior Trend of Candlesticks: Bearish
Reliability of Candlesticks : 4th Grade
Confirmation of Candlesticks: Rare
Candlestick Patterns Key Reference |
DESCRIPTION
Stick Sandwich pattern is identified when Bearish Marubozu candlestick is formed.
Then it is followed by a candlestick at the bottom of a downtrend with a gap up and close above the open price of the previous candlestick.
The third Bearish Marubozu candlestick closes at the same level as the first Bearish Marubozu candlestick.
This indicated that prices is finding its support and we may see a reversal from this support level.
PATTERN RECOGNITION
1. The Stick Sandwich pattern is identified by a downtrend.
2. We will see a Bearish Marubozu on the first candlestick.
3. Then we will see a candlestick at the bottom of a downtrend with a gap up and close above the open price of the previous Bearish Marubozu candlestick.
4. Finally we will see a Bearish Marubozu candlestick which closes at the same level as the first Bearish Marubozu candlestick.
EXPLAINATION
The Stick Sandwich pattern happen in a downtrend.
The first Bearish Marubozu candlestick indicate a bear during a downtrend.
Then we see a
candlestick at the bottom of a downtrend with a gap up and close above the open price of the previous Bearish Marubozu candlestick. This bullish act implies that shorts need to take caution.
Then we see another Bearish Marubozu candlestick open higher than the previous candlestick, leading some shorts to close their position intially but then the prices start to move lower to close at the same level as the first Bearish Marubozu candlestick.
This pattern indicates that the market is now finding a support level and now the trend might reverse from this support level.
The 4th grade reversal patterns are rare reversal patterns that may require confirmation in the next session.
POINT TO NOTE
A confirmation on the fourth bullish candlestick is required with a large gap upward or a higher close to ensure the reversal of trend.
CANDLESTICK PATTERNS KEY REFERENCE
Irrespective of Color (Can be bullish or bearish) |
Uptrend |
Consolidation |
Downtrend |
ANTICIPATED DIRECTION OF TREND
Lighter Arrow = Lower Probability
Solid Arrow = Higher Probability
More Likely to go sideway, Less likely to rally
|
More likely to rally, Less likely to go sideways
|
More likely to go sideway, Less likely to fall
|
More likely to fall, Less likely to go sideways |
