Introduction

The Bullish Harami Cross is a strict variation of the standard Harami. The difference? The “baby” candle is not just small—it’s a Doji (where Open equals Close).

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How to Identify It

1. Candle 1: A Long Red candle.
2. Candle 2: A Doji (looks like a cross or plus sign).
3. The Rule: The Doji must be completely contained within the body of the previous Red candle.

The Psychology

A Doji represents a perfect tie between buyers and sellers. When this happens after a massive crash (the long red candle), it shocks the market. The confidence of the sellers has evaporated instantly. This sudden freeze often precedes a violent move in the opposite direction.

Trading Strategy

• The Squeeze: This pattern often forms a “pennant” on lower timeframes.
• Entry: Place a buy-stop order above the high of the Mother candle.
• Warning: If price breaks the low of the Mother candle, the crash will resume violently.