Bullish Dragonfly Doji Pattern
The Bullish Dragonfly Doji Pattern is a single candlestick pattern that occurs at the bottom of a downtrend. The Bullish Dragonfly Doji Pattern is very similar to the Bullish Hammer. The distinction between the two is the existence or none of the real body. In case of Bullish Dragonfly Doji Pattern, the opening and closing prices are identical and there is no body. On the other hand the Bullish Hammer has a small real body at the upper end of the trading range.
The market is going southbound or in a downtrend. Then market opens and sells off sharply. However, the sell-off is suddenly stopped and the price reverses direction and start to go up until the closing thus creating a long lower shadow. The failure of the market to continue in the selling side reduces the bearish sentiment.
Even if this pattern has a high reliability still a confirmation of the trend reversal is needed by either a green candlestick, a large gap up or a higher close on the next trading day.
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