Candlestick Patterns
Resources for Advanced Trading

Candlestick Incomplete Dark Cloud Cover Patterns
Bearish Reversal - Sell Signal (with Confirmation)

Candlestick Patterns

The Incomplete Dark Cloud Cover pattern is similar to the Dark Cloud Cover pattern. The difference is the black bar is not able to close below the midpoint of the white bar. The Incomplete Dark Cloud Cover pattern is formed when a white candle is followed by a black candle that opens higher than the white candles close and when the black candle closes above the mid-point of the white candle's body. This type of pattern is common in uptrends, so we strongly suggest waiting for confirmation before acting on this signal.

The Incomplete Dark Cloud Cover pattern is a warning of a potential bearish reversal. If you are long when this pattern forms, adjust your stop and prepare for a potential bearish reversal. A good stop level is the midpoint (or below) of the white candle. Another suggestion would be to use a "Stop/Reverse Limit Order" that will attempt to reverse you at the same time you exit your long trade.

Notice: Sometimes, by the time the confirmation candle is formed, the majority of the bearish trend has occurred. By this I am attempting to inform investors that sometimes as aggressive short position after a Incomplete Dark Cloud Cover pattern has formed will result in good profits by the time the confirmation candle forms. Aggressive investors should always use a protective stop level to protect against unwanted losses. An appropriate protective stop level for the Incomplete Dark Cloud Cover pattern would be at, or near, the highs of the Incomplete Dark Cloud Cover pattern.

CONTINUE