Dark Cloud Cover in Candlestick Reversal Pattern

  • The Dark cloud cover is a two candlestick bearish reversal pattern and much similar to the bearish engulfing pattern.
  • In this pattern, the second candle, unlike the bearish engulfing pattern falls short of engulfing the first candle, instead it crosses 50% the body of the first candle.
  • The confirmation comes when a candle breaches the bottom of the pattern. On confirmation a short trade can be taken with stop loss above the high of the candle.

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