Glossary Term

Harami

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Harami is a candlestick pattern used in technical analysis. Harami is the Japanese word for pregnant. And a harami formation looks a little like a pregnant woman, with a large candle (like a woman’s body) engulfing a small candle (like a woman’s pregnant belly). The pattern is used as a reversal signal and has both bullish and bearish version. A bearish harami is a long up candle followed by a small down candle that gaps down to the middle of the previous candle. A bullish harami is the opposite of this. It is composed of a large down candle followed by a small up candle (engulfed by the previous candle), that gaps up and trades roughly in the middle of the previous candle,

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