Rising Window Candlestick Pattern

A Rising Window formation, which appears during an uptrend, is characterized by a gap between the real bodies of two candles, with no overlap between their shadows. This gap represents the distance between the high of the previous candle and the low of the current candle and indicates that bulls are in control and the price is expected to continue rising.

What is the Rising Window Candlestick Pattern?

The Rising Window candlestick pattern, also known as a “Bullish Harami,” is a pattern that was first identified and described by Japanese rice trader Homma Munehisa in the 18th century. Homma was one of the first traders to recognize the importance of emotions and sentiment in the market, and his methods of analyzing price action through the use of candlestick charts helped lay the foundation for modern technical analysis. Candlestick charts are now widely used by traders and investors around the world to analyze price movements and identify potential trading opportunities.

The Rising Window candlestick pattern occurs when a bullish candle’s high is above the previous candle’s low and the high is above the previous candle’s high, creating a gap or “window” between the two candles. This pattern indicates a shift in control from bears to bulls and suggests an upward movement in prices.

A Bearish candle was engulfed by a larger Bullish candle
A Bearish candle was engulfed by a larger Bullish candle

Rising Window Candlestick Pattern Strategy

Buy Signal

When the current candle’s low is higher than the previous candle’s high. This pattern indicates that buyers are pushing the price higher. To enter a long position using this pattern, one should place a buy order at the opening price of the current candle or at a price slightly above it.

Bullish Rising Window Candlestick Pattern
Bullish Rising Window Candlestick Pattern

Rising Window Candlestick Pattern Pros & Cons

Pros

  • It indicates a strong bullish sentiment and potential upward price movement.
  • It can signal a potential buying opportunity for traders.

Cons

  • It is a relatively rare pattern, so it may not appear frequently in a chart.
  • It should not be relied on as the sole indicator for making a trade, as market conditions and other factors can affect price movements.
  • False signals can occur, especially if the pattern appears in a downtrend or at market tops.

Conclusion

The Rising Window candlestick pattern, also referred to as a “Bullish Harami,” is a bullish formation that appears during an uptrend. It is identified by a gap between the real bodies of two candles, with no overlap between their shadows, signaling a change in control from bears to bulls and indicating a potential upward movement in prices. This pattern was first recognized by Japanese rice trader Homma Munehisa in the 18th century and is widely utilized by traders and investors globally for analyzing price movements and identifying trading opportunities, this pattern most likely appear when the bears are strong but suddenly lose their power to pull¬† the market price in the deeper ground, traders can place a buy when the a bear candle was engulfed by a bullish candle and then a gap suddenly appear between the two bullish candles.