Like the Marubozu candlestick pattern, the bulk of the candle’s meaning is found in its size because the shadows (or wicks) are either tiny or nonexistent.
- A downtrend must precede the candlestick.
- After the stretch of bearish candlesticks, a bullish (white) candlestick must appear.
- The pattern should be composed of a long white candlestick with a short upper shadow (or no upper shadow).
- The candlestick should lack a lower shadow entirely.
The Bullish Belt Hold candle’s opening price is at the low of the trading session.
During the session, however, the price rallies up and it closes at (or near) session highs, forming a white candlestick.
The bottom of the candle represents the opening price, the top of the candle represents the closing price, and the top of the upper wick identifies the highest price reached in the session.
To better analyze a Bullish Belt Hold candlestick, look for the following observations:
- The longer the candle, the more powerful and significant the reversal potential.
- To confirm the signal, the pattern should be followed by a bullish candlestick.