Hikkake Pattern
The Hikkake pattern is a complex bar or candlestick pattern that starts out moving in one direction but quickly reverses and is said to set a forecast for a move in the opposite direction. The pattern has two different configurations: one that implies a short-term downtrend in price action, and a second that implies a short-term uptrend in price. The pattern has four key points:
The first two candles (or bars) of the pattern are decreasing in size. These are referred to as inside-day patterns or Harami patterns. It does not matter if one of these days closes higher or lower than the open, as long as the body of the first completely eclipses the body of the second.
The third candle closes below the low in the first setup (or above the high in the second setup) of the second candle.
The next candle(s) will drift below (or above in the second setup) the third candle and may begin to reverse direction.
The final candle will close above the high of the second candle (or below the low of the second candle in the second setup).
Once the fourth characteristic is reached, the pattern implies a continuation in the direction of the final candle.