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The Bearish Belt Hold patterns stand out due to their simplicity and reliability. They are also called the yorikiri pattern.
“Yorikiri” is a term used in sumo wrestling to describe a winning technique. It translates to “force out” in English. This manoeuvre involves a wrestler (rikishi) grabbing their opponent’s mawashi (belt) and using forward momentum to push them out of the dohyo (ring).
A Belt Hold pattern is a single candlestick formation that signals a potential reversal in market trends.
A Bearish Belt Hold pattern typically appears at the top of an uptrend, indicating a potential reversal to the downside. It forms when:
The absence or minimal presence of an upper shadow indicates that sellers dominated the price action from the open to the close.
The Bearish Belt Hold pattern suggests strong selling pressure from the market open. The lack of an upper shadow indicates that sellers-maintained control, pushing the price down throughout the session. This pattern suggests that the previous uptrend might weaken, and a bearish reversal could be on the horizon.
The traders seek confirmation for the Bearish Belt Hold pattern. This might involve:
– Waiting for a subsequent bearish candle to confirm the downward move.
– Observing increased trading volume during the Belt Hold formation to validate the signal.
– Utilizing other technical indicators to support the reversal signal.