Inside Bar Candlestick Pattern📉📉📉We will cover the following today:
Inside Bar (Inside Day)
Inside Days
✅ Inside Days are a daily pattern involving two daily candles, we have a day of trade, also known as the ‘mother candle’ and then the following day trades the whole day within the range of the previous day. This is a two-day bias suggesting a potential reversal. A great way to play these sorts of biases is to pre-empt the failure of this reversal, as well as playing the success of the inside day, so what does this look like? Let’s take a look at an example below.
✅ What is an inside bar?
The inside bar is a popular reversal/continuation candle formation that only requires two candles to present itself. This pattern is a direct play on short-term market sentiment looking to enter before the 'big moves' that may take place in the market.
✅ Is an inside bar bullish?
First, unlike other candlestick patterns, inside bars are usually not distinguished as bullish and bearish by their look or color of the body itself, but rather by the location they are at and other peripheral developments
✅ An “inside bar” pattern is a two-bar price action trading strategy in which the inside bar is smaller and within the high to low range of the prior bar, i.e. the high is lower than the previous bar's high, and the low is higher than the previous bar's low.
📈 HOW TO IDENTIFY AN INSIDE BAR ON FOREX CHARTS
The following steps are used when identifying the inside bar pattern on forex charts:
Identify a preceding trend using price action/technical indicators
Locate inside bar pattern whereby the inside bar is engulfed fully by the preceding candle high and low
