Bearish Thrusting Candle Pattern Explained

Bearish Thrusting Candle Pattern Explained
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A Bearish Thrusting Candle Pattern is a candlestick chart pattern which signals a potential continuation in the market. In this article we will show you how to identify it in the right market condition.

The Bearish Thrusting Candle Pattern is a Bearish candle pattern which signals a potential continuation when forming in a downtrend.

Bearish Thrusting Candle Pattern Criteria:

  • The first candle of this two candlestick pattern is a red (bearish) candle with a strong real body.
  • The candle forms in a down-trend.
  • The second candle’s price opens below the prior session’s low price (that is, below the low of the lower shadow). However, by the end of that candle’s session, the market closes into the prior candle’s real body but not more than 50%.
  • The second candle should be a longer green (bullish) candlestick.

Additional Notes:

  • The pattern looks like a failed Piercing Pattern. To read more about that pattern, have a look at this article: Piercing Candle Pattern Explained.
  • When the price moves under the second candlestick low, that can be a signal of a continuation of the down-trend and a potential sell signal.
  • This pattern is similar to the On Neck and In Neck Candle Pattern with just a slight difference being the second candle’s movement into the first candle’s range. To see the difference read these articles: On Neck Candle Pattern (Link), In Neck Candle Pattern (Link).

Quick Reference Guide – Candlestick Basics. If you need a reminder of what candlesticks are have a look at our free PDF – Candlesticks Explained.

The criteria and examples above are just the technical definitions of this pattern. However patterns are only useful with context and with real chart examples.

No pattern will ever exactly match the criteria and in order to be a useful signal must occur in the correct place in a trend. Let’s start by looking at the the classification table for this pattern:

Bearish Thrusting Candle Pattern Classification Table

Number of Candles In Pattern 2
Type: (Reversal/Continuation) Continuation
Bullish/Bearish/Indecision Bearish
Market Conditions: Range, Down-trend, Up-trend Down-trend, Ranging
Position: Top, Bottom, Range Range

What Price Action Does The Bearish Thrusting Candle Pattern Represent?

All candlestick patterns are formed by price action. But the popular ones represent price action that may have significance in signalling the direction of the market.

The Bearish Thrusting Candle Pattern consists of an initial large bearish candle that forms in a down-trend. However, strong candles in the direction of a prevailing trend can often be followed by exhaustion of the trend and a reversal (or a pause at least).

Before we can see the initial bearish candle as a continuation of the trend, we need some confirmation.

The second candle opens below the low of the first candle (gaps down). This starts off as a positive downward signal, but then starts to move up.

This could be the start of a reversal pattern but the move fails and the second candle’s real body fails to extend beyond a 50% reversal of the first candle’s real body.

This failure to reverse the bearish momentum is a potential signal that the bears are still dominant that a continuation of the trend down will occur. When the price moves below the low of the second candle then it could be a signal to sell.

Bearish Thrusting Candle Pattern With Confirmation

In this US30 market example below we can see that the market was in a downtrend. As the price action neared a round level that had previously seen resistance, it formed a Bearish Thrusting Pattern.

The price action then moved below the Bearish Thrusting Pattern and also broke the round level support. This indicated a strong probability that the market would continue to move lower.

Bearish Thrusting Candle Pattern Example With Confirmation Example
Bearish Thrusting Candle Pattern Example With Confirmation Example

Note: you can get a free round level indicator for MT4 from us here: Round Levels MT4 Indicator.

In What Market Conditions Does Bearish Thrusting Candle Patterns Become A Signal?

To recap, the Bearish Thrusting Candle Pattern is seen as a bearish continuation pattern when it forms in an existing down-trend and then the market moves below the second candle.

Note: With any candle pattern or signal, it is more significant when there is confirmation from another indicator or via forming at a key level. It is always good practice to look for confirmation for any signal that you are looking to trade.

Bearish Thrusting Candle Pattern In A Down-Trending Market

A down-trending market is one where the price action generally moves down over time and is characterized by lower lows and lower highs.

Down-trending Market Example
Down-trending Market Example

The Bearish Thrusting Candle Pattern is generally seen as a most valid in a down-trend.

In this US30 market example below the market was in a downtrend. This downward trend was marked by several strong bearish candles and the formation of the Bearish Thrusting Candle Pattern was an additional good signal that the downtrend would continue lower.

Bearish Thrusting Candle Pattern In A Down-trending Market Example
Bearish Thrusting Candle Pattern In A Down-trending Market Example

Bearish Thrusting Candle Pattern In A Ranging Market

A ranging market is one where the price action moves up and down between two sets of support and resistance. This is also known as a sideways, balancing or horizontal market. In essence the price action is struggling to break out of the range decisively either on the upside or downside.

Ranging Market Example
Ranging Market Example

Although not generally a strong signal in a ranging market, this pattern, when forming in the downward leg of a ranging market can be seen as a signal that the market will continue to the bottom of the prevailing range.

As you can see in this example of the US30 market the price action was retracing downwards after a previous move up from a level of support.

On the move down a Bearish Thrusting Candle Pattern formed which was a good indication of the continuation of the downward trend to the previous level of support to form the bottom of a range.

Bearish Thrusting Candle Pattern In A Ranging Market Example
Bearish Thrusting Candle Pattern In A Ranging Market Example

Bearish Thrusting Pattern As A Reversal Signal

It is important to note that candle patterns are only telling a story of price action and can never be relied on as a perfect signal. In the US30 example below we can see that the market formed a Bearish Thrusting Candle Pattern in a downtrend.

However, the price action never closed below the second candle and in addition, the second candle formed a Hammer Candle Pattern.

In this circumstance, this pattern could actually have been used as a potential reversal signal.

As mentioned already, you should always see candle patterns as a potential story about the price action – if the price action doesn’t match the story then stay out of the market till you have a better signal or confirmation.

Thrusting Candle Pattern Example As A Reversal Signal Example
Thrusting Candle Pattern Example As A Reversal Signal Example

Candle Pattern MT4 Indicator Downloads

If you trade using MT4 then why not try out our free MT4 indicators? Most of our indicators, including the most common candle pattern indicators are Free and available for download here: MT4 Indicator Page.

Most of our candle indicators also have an alternate version which can show the signal in a separate indicator window of the chart if that is your preference.
For advanced users you can use our Pin Bar Pattern Manager (Paid) to specify your own parameters of candles you want to identify. You can find that here.

Important Information About Candlestick Patterns

Attribution:

All of the candlestick patterns that we explain on NothardTrading.com must be attributed to Steve Nison and his books on candle charting, the most famous of which was Japanese Candlestick Charting Techniques (Amazon). You can also find out more at his website here.

Interpretation Of Candle Patterns:

It is important to note that these patterns were originally identified on the daily timeframes of index charts, which is still where they are the most useful. However, this does not mean that they cannot be used for other markets or time frames.

No signal is perfect and should never be used as such. Any patterns that you identify only signals a potential move based on the fact that history repeats itself and forms regular patterns in similar situations.

But past performance is no guarantee of future results! So always treat these patterns with care and think of these guidelines when using them.

Best practice guide for trading of candle patterns:

  • No pattern is ever perfect. Be aware that patterns will form slightly differently each time and in different markets.
  • Use them as consistently as possible. Even though you will never find patterns exactly the same, you should always implement a consistent ruleset when identifying and using patterns.
  • It is never a guarantee, only an indication.
  • Make sure you are using it in the right context. For example if it is a continuation pattern then don’t use it to trade reversals!
  • Use multiple signals (confirmations) to have more confidence in your trading.

Related Candle Patterns

In Neck Candle Pattern

To learn more about In Neck Candle Pattern, see our article here: In Neck Candle Pattern Explained

On Neck Candle Pattern

To learn more about On Neck Candle Pattern, see our article here: On Neck Candle Pattern Explained

Piercing Candle Pattern

To learn more about Piercing Candle Pattern, see our article here: Piercing Candle Pattern Explained.

Bullish Counterattack Lines Candle Pattern

To learn more about Bullish Counterattack Lines Candle Pattern, see our article here: Bullish Counterattack Lines Candle Pattern Explained

Justina Nothard

Justina Nothard

Hi, I’m Justina Nothard, a retail investor trading Stock Indexes and Forex Markets.

I understand how hard it can be for the ordinary trader to learn the basics and find useful tools and practical information.

This is why I decided to create Nothard Trading to help you take control of your trading.

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