Upside gap two crows
The setup known as upside gap two crows is referred to the gap occurring between a small black candle and the preceding candle which is usually a long white candle. The two black candles forming the pattern are the two crows which “look down from the branch of a tree menacing the market”. The second black candle, with an open value which is greater than previous candle open and a close which is smaller than the preceding candle close, fully engulfs the first black candle, remarking the strength of the bearish signal.
The main pattern features are:
- The first candle is a long white candle;
- There is a gap between the first candle and the second candle;
- The third candle opens above the second candle open and it closes under the previous close, engulfing the second candle;
- The third candle close is above the white long candle’s close.
The rationale behind this pattern lies in the progressive uncertainty of buyers who have been driving the market up; the first black candle with a small range provides us a first indecision signal that doesn’t scare too much the bulls, since it makes a higher close than the previous session’s close. The second black candle instead, even if it opens with a new high, brings the price under the first black candle close, creating strong doubts for the bullish side of the market.
- Candlestick analysis sequential index
- Patterns sequential index
- Minor reversal
- Harami cross
- Belt hold lines
- Upside gap two crows
- Three black crows
- Identical three crows
- Counterattack lines
- Unique three river
- Three stars in the south
- Concealing baby swallow
- Stick sandwich
- Summary "Minor inversion formations"