Bearish Harami Strategy

The Bearish Harami is the inverse of the bullish version, appearing after an upswing. Here a small candle forms completely inside the prior bullish bar, hinting that upward momentum is stalling.

Testing indicates an average annual return of about 43%. It performs best in the stocks market.

The strategy sells short when that inside candle closes, betting on a reversal as buyers lose conviction.

A percent stop above the pattern high caps the risk and the trade exits if price breaks to new highs.

Details

• Entry Criteria: pattern match
• Long/Short: Both
• Exit Criteria: stop-loss or opposite signal
• Stops: Yes, percent based
• Default Values:
  • CandleType = 15 minute
  • StopLoss = 2%
• Filters:
  • Category: Pattern
  • Direction: Both
  • Indicators: Candlestick
  • Stops: Yes
  • Complexity: Intermediate
  • Timeframe: Intraday
  • Seasonality: No
  • Neural networks: No
  • Divergence: No
  • Risk level: Medium