Abandoned Baby is a Japanese pattern of candlestick formed by three candles in reversal manner. It contains two candles and one doji with bodies.
There is a gap before and after the doji. There must be gap in shadows on the doji or first and third candle must have a gap below or above the shadows.
Abandoned Baby is of two types:
- Bullish Abandoned Baby
- Bearish Abandoned Baby
The Abandoned Baby pattern is found rarely because specific criteria must be fulfilled by price movements to form a pattern.
The criteria identification of Abandoned Baby pattern Patter is given below:
Bullish Abandoned Baby
- Downside must contain a large black or red candlestick
- There must be a doji after black candle that gaps below the close of the first candle.
- The last candle must be white (or green) and open above the doji in the three-candlestick pattern.
Bearish Abandoned Baby
- The upside must contain a large white (or green) candlestick
- There should be a doji after a white candle that gaps above the close of the first candle.
- The last candle must be black (or red) and open below the doji in the three-candlestick pattern
- Gaps must be in the first and second and second and third candles as well.
Neighboring candles must NOT overlap
- On overlapping, these would be a Morning Star or Evening Star candlestick pattern.
- The Abandoned Baby is a reversal pattern.
- There is a short break after a uptrend and downtrend, an uncertain situation (caused by the doji).
- After that momentum stars transferring suddenly.
- The bears take control and push the price downward when an uptrend occurred previously.
- The bulls take control and push the price upward when it was found a downward in past.
- This rapid shift signals a strong reversal.
- A strong reversal occurs due to this fast shift signals
- The reversal will be greater, if there’s a large gap
A
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B
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C
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