Bullish Belt Hold Candlestick

Bullish belt hold is a trend-reversal candlestick pattern which indicates the end of a downtrend and beginning of a new uptrend. It is a single candlestick pattern formed of a long white (bullish or colorless) candlestick, which is an opening marubozo having no lower shadow. Bullish belt hold candlestick occurs frequently and is considered less reliable; thus it is vital to confirm the trend change.


The requirements of a bullish belt hold candlestick are,

• The long white candlestick should be formed after a significant downtrend.
• The price of the day should open below a significant gap (except forex charts) and the opening price should be the lowest price for the day.
• The day should be noticeable with strong bullish activity so that the price closes at or near the highest price of the day.

Bullish belt hold candlestick forms when the bears fail to keep the downtrend and the bullish activities at opening hours (and lower gap opening) tempt many shorts to cover their positions. This enhances the confidence of bulls and marks the beginning of a new uptrend.

Reliability of bullish belt hold candlestick is low; reliability can increase with increase in real-body of candlestick, increase in trading volume and with weakening of prior downtrend. The confirmations can be a bullish candlestick or a higher gap on next trading day. Traders can also use other volume and trend analyzing tools to confirm trend changes and to find enter and exit points.

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