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Definition

 

Bullish Three Inside Up is also called Confirmed Bullish Harami formation. The third day confirms the ascending market trend.

  • Trend: Reversal
  • Expected trend: Bullish
  • Previous trend: Bearish
  • Reliability: Moderate
  • Type: Bullish
  • Number: 3

Recognition

  • The market is in a downward trend.
  • The first two days are a Bullish Harami formation.
  • The third is a white candle, closing above the first candle’s closing price.

Interpretation

The first two candles match the inclining trend. There is no signal for reversal. The second day stays in the range of the first candle’s body. It is characterised by a narrow trading range. The third day can confirm the trend reversal. The closing price on the third day must be above the first day’s opening price.

Important factors

The formation is highly reliable, but a confirmation is necessary (may come from a white candle with higher closing price or gap).