How to identify

1.   An uptrend is under way 2.   A long white day occurs 3.   The second day is a black day where the real body is completely engulfed by the real body of the first day 4.   The tops or bottoms of the real bodies can be equal, but both tops and both bottoms cannot be equal

For a Harami bear, an uptrend is in place and is perpetuated with a long white day and high volume. The next day prices open lower and stay in a small range throughout the day, closing even lower creating a black candlestick but still within the previous day's body. This is a signal that the current uptrend is losing strength. In view of this sudden deterioration of trend, traders should become concerned about the strength of this market, especially if volume is light. It certainly appears that the trend is about to change. Confirmation on the third day would be a lower close.

The Harami bear pattern is also the first two days of the Three Inside Down bear pattern.

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