In Neck Line |
Characteristic of Candlesticks: Reversal
Relevance of Candlesticks: Bearish
Prior Trend of Candlesticks: Bearish
Reliability of Candlesticks : Recommended
Confirmation of Candlesticks: Reliable
Candlestick Patterns Key Reference |
DESCRIPTION
In Neck Line pattern is a two candlestick formation.
In Neck Line pattern is recognized by a bearish candlestick followed by a smaller bullish candlestick, which its closing price is slightly above the first bearish candlestick's low during a downtrend.
If the low of the white candlestick break new low, the market will go further down.
PATTERN RECOGNITION
1. In Neck Line pattern can be identified by downtrend.
2. Refering to above diagram, we will firstly see a long bearish candlestick.
3. Then we will see a following bullish candlestick (Bullish Marubozu) which closing price is slightly above or equal to the closing price of the previous candlestick.
EXPLAINATION
The In Neck Line pattern look very similar to Deaisen Meeting Lines pattern but the Bullish Marubozu meet the close of the previous bearish candlestick.
It also look like an an undeveloped version of the Bullish Piercing Line pattern with much lower close.
The second bullish candlestick closing price is just inside the previous day's body or slightly above its close. So it will be a higher close than the On Neck Line pattern, but not very much.
The Continuation Patterns imply that a trend has temporary paused and will continue its original trend rather than reversal.
POINT TO NOTE
The second bullish candestick of In Neck Line pattern must be a small body.
A confirmation is required by the third bearish candlestick with a gap down or lower close.
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 |
