Today i want to share 2 candlestick formation which i rely most
1) Abandon Baby Formation
2) Kicker
Definition:
1) Abandon Baby Formation: It is a 3 candlestick pattern & need confirmation in 4 th candle. It is basically a reversal pattern. First candle is long black/white candle ,second one is gap up/down candle which can be hammer ,doji ,small body , long legged candle & third one is again gap up/down candle with body more than 2nd one.Most important aspect of this formation is gap b/w this 3 candles. thats why the name abandon baby.
Volume Aspect: 1st Candle:- Usually normal to high
2nd Candle:- Mostly high in rare case low volume but both are positive
3rd Candle :-High to medium high as compared to last 10 candles in normal case.
2) Kicker : It is a 2 candle pattern & need confirmation in 3rd candle. It is basically a very strong reversal pattern. First candle can be any pattern but need to at least small body in uptrend or downtrend & second one can be any pattern . But whats important is opening & closing of both candles. Here i am explaining the bearish kicker . The first candle is usually a long black candle after some long down trend n closed near to low of candle with small to medium volume as compared to previous candles & second candle opens above the opening of previous candle n closes even higher than previous candle.
Volume Aspect: 1st Candle:- Usually medium as compared to last candles
2nd Candle:- Mostly higher n should be higher as compared to last 5 candles for proper reversal.
I am putting some example from various market in different scenario.
Please enlarge pics if not witnessed clearly.
Above is the daily chart of Nifty Classic example of kicker formation with rsi divergence . Just see rally afterwards
Above is the chart of soya refined bearish kicker formation is witnessed.
Above is the chart of Soybean , First circle shows abandon baby formation & last circle shows bearish kicker formation. Now if u add other study with this pattern u will get stronger move like in this example there is bullish divergence in rsi. it might be a good trade setup.
In both formation volume is the most important aspect & usually strong hand enters here as emotions n sentiments both are at their extreme. One should not avoid this signal of reversal as early sign of trend change & must review his study or strategy at once.
1) Abandon Baby Formation
2) Kicker
Definition:
1) Abandon Baby Formation: It is a 3 candlestick pattern & need confirmation in 4 th candle. It is basically a reversal pattern. First candle is long black/white candle ,second one is gap up/down candle which can be hammer ,doji ,small body , long legged candle & third one is again gap up/down candle with body more than 2nd one.Most important aspect of this formation is gap b/w this 3 candles. thats why the name abandon baby.
Volume Aspect: 1st Candle:- Usually normal to high
2nd Candle:- Mostly high in rare case low volume but both are positive
3rd Candle :-High to medium high as compared to last 10 candles in normal case.
2) Kicker : It is a 2 candle pattern & need confirmation in 3rd candle. It is basically a very strong reversal pattern. First candle can be any pattern but need to at least small body in uptrend or downtrend & second one can be any pattern . But whats important is opening & closing of both candles. Here i am explaining the bearish kicker . The first candle is usually a long black candle after some long down trend n closed near to low of candle with small to medium volume as compared to previous candles & second candle opens above the opening of previous candle n closes even higher than previous candle.
Volume Aspect: 1st Candle:- Usually medium as compared to last candles
2nd Candle:- Mostly higher n should be higher as compared to last 5 candles for proper reversal.
I am putting some example from various market in different scenario.
Please enlarge pics if not witnessed clearly.
Above is the Chart of Bank nifty ,Kicker is shown in three different circle n just see after ward move
Above is chart of USDINR SPOT (weekly). Bullish Kicker & Abandon Baby both are encircled.
Above is the chart of NIFTY . There are three abandon baby formation shown in circle with one kicker not shown in chart hope u can find it. Please enlarge chart if not seen properly.
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Conclusion:
In all above chart one can easily witness the afterward move. Both formation when use with other trading system like divergence , trend line breakout , or moving averages can give us an early sign of reversal & it can be used for some handsome profit as risk from that level is negligible.In both formation volume is the most important aspect & usually strong hand enters here as emotions n sentiments both are at their extreme. One should not avoid this signal of reversal as early sign of trend change & must review his study or strategy at once.
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