For a better understanding of this article, you should already know what Japanese Candlesticks are and all their features; for this reason, we suggest you to read this introductory article to Japanese Candlesticks LINK ( So that you can understand also the Ratings given to the Candlestick Patterns for the “quality” of the signal and for their frequency to “appear” on Charts).
Let’s analyse now the following Candlestick Pattern: “Concealing Baby Swallow”.
Concealing Baby Swallow
– It could be a signal of reversal or continuation of the current Trend.
– Is a rare Pattern.
– It occurs during a Downtrend; confirmation is required by the candles that follow the Pattern.
– The First and Second Candle are both long and black (They are two Marubozu).
– The Third Candle is black, it has a long Upper Shadow and gaps down from the Previous Candle; the High of the Third Candle is higher of the Close of the Second Candle.
– The Fourth Candle is black, without Shadows (Is a Marubozu); with its Real Body fully contains the Third Candle (Also the Upper Shadow of the Third Candle).