๐ขPowerful Candlestick Patterns:๐ฃ๐ฎ๐ฟ๐-18
๐๏ธ18. Bearish Abandoned Baby
๐นA bearish abandoned baby is a pattern that suggestsย bearish reversal. The first candle is strongly bullish. The second one opens following a gap and is a doji. Strong bearish candle that gaps down and indicates a trend change is the third candle.
๐นThe bearish abandoned baby patternย forms when the market sentiment shifts from bullish to bearish. The initial strongly bullish candle represents the buying pressure in the market, but the doji candle that follows indicates indecision and a weakening of the buying pressure. The final strong bearish candle that gaps down then confirms the reversal, as the sellers take control of the market.
๐นAccording to a study titled โThe Effectiveness of Technical Analysis: An Empirical Study of Candlestick Patternsโ by Professors Lu Zheng and Wenjun Xie, published in the Journal of Empirical Finance, the Bearish Abandoned Baby pattern has a success rate of approximately 78% in predicting bearish reversals.
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