Bullish Abandoned Baby
Reference values based on Bulkowski's "Encyclopedia of Chart Patterns". Data is primarily from U.S. markets and may differ for other markets.
An extremely rare three-candlestick pattern that appears at the bottom of a downtrend. After the first large bearish candle, a doji appears with a gap down, followed by a large bullish candle with a gap up. This is an enhanced version of the Morning Star, where the second doji must have complete gaps separating it from both adjacent candles. Although its frequency is low, it is a very powerful reversal signal.
Enter long at the open of the next candle after the third large bullish candle is confirmed. Verify that the third candle has recovered to at least the midpoint of the first candle's body. Since this pattern is extremely rare, be vigilant not to miss it.
Project the total range of the pattern (from the first candle's open to the second candle's low) upward from the third candle's close to determine the price target. Larger moves than a Morning Star can be expected.
Place a stop-loss slightly below the low of the second doji. If the gap is filled, consider the pattern failed.
Ideally, volume is high on the first candle, decreases significantly on the second doji, and surges on the third candle. A volume spike on the third candle indicates strong buying pressure.