Bearish candlestick patterns warn that an uptrend may be ending and sellers are gaining control. Spotting these at resistance levels can save you from buying at the top or help you take profits before a crash. Here are 7 essential bearish patterns.
1. Bearish Engulfing
A small green candle followed by a large red candle that completely covers the green candle’s body. The mirror image of the bullish engulfing. Most powerful at resistance after a prolonged uptrend. The larger the red candle, the stronger the signal.
2. Evening Star
Three candles: (1) large green candle, (2) small-bodied candle that gaps above, (3) large red candle closing below candle 1’s midpoint. The bearish counterpart to the morning star. One of the most reliable bearish reversal patterns.
3. Shooting Star
Small body at the bottom, long upper wick (2x+ body). Appears after an uptrend. Buyers pushed price up but were overwhelmed by sellers who drove it back down. The upper wick represents rejected buying — sellers won the battle.
4. Hanging Man
Identical shape to the hammer but appears after an UPTREND. Small body at the top, long lower wick. Warning: the selling during the period was significant even though buyers recovered. May precede a reversal. Needs next-candle confirmation.
5. Three Black Crows
Three consecutive large red candles, each opening within the previous candle’s body and closing lower. Strong sustained selling pressure. The bearish counterpart to three white soldiers. Very reliable reversal signal.
6. Dark Cloud Cover
Two candles: (1) green candle in uptrend, (2) red candle that opens above the green’s high but closes below its midpoint. The red candle “covers” the green like a dark cloud. Stronger the deeper the red candle penetrates.
7. Tweezer Top
Two candles with matching highs — first green, second red. Sellers created a ceiling at the exact same price. Indicates strong resistance. Best when appearing at established resistance levels.
Trading Bearish Patterns
- Use these to take profits on existing long positions
- Use these to avoid buying at the top
- If you trade short: enter after confirmation with stop above the pattern’s high
- Always check the bigger picture — a single bearish candle in a massive uptrend doesn’t mean the trend is over
- Combine with RSI overbought (70+) and resistance levels for highest probability
Monitor these patterns on your Mal.io trading pairs to improve your exit timing.
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