Bearish Counter-Attack Candlestick Pattern

The Bearish Counter-Attack candlestick pattern is a bearish reversal candlestick pattern. A Bearish Counter-Attack candlestick pattern can lead to a swift price reversal to the downside.

An uptrend has been in place for some time and bullish investors feel good about the momentum of the share price. A Bearish Counter-Attack candlestick pattern starts off with much more of the same, maybe even a little too much jubilee as the price opens with a gap-up compared to the previous candlestick pattern's closing price. Bullish investors are feeling great about the morning gap-up.

But somewhere in the middle of the trading period, things change. Investors are selling shares and by the end of the trading period the closing price for the candlestick is the same, or even slightly below the previous candlestick's closing price. Hence the "counter-attack" naming convention.

The selling momentum usually carries into the next couple of trading periods. But after the share price ceases to decline and starts to rebound, it may be best to wait for a re-test of the bottom before the rebound. The first re-test of the Bearish Counter-Attack's resistance area is key to determining the significance of the candlestick.

Requirements

These are the requirements for a Bearish Counter-Attack candlestick pattern.

• A Bearish Counter-Attack candlestick pattern is made up of 2 candlesticks
  • The 1st candlestick in the pattern has a green colored real body
• The 2nd candlestick in the pattern gaps higher at the open than the 1st candlestick's closing share price
  • The closing share price, even after the initial gap-up, closes at the same or almost the same share price as the 1st candlestick in the pattern
• The Bearish Counter-Attack is confirmed on the 3rd candlestick if the share price continues the reversal of momentum that started to take place with the 2nd candlestick

Characteristics & Observations

These are some of the characteristics I have observed with several different Bearish Counter-Attack candlestick patterns......

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