Lesson 4 of 10 · 7 min

Harami & Inside Patterns

The Pregnant Candle

Harami means "pregnant" in Japanese. In this pattern, the second candle is completely contained within the first - like a baby inside its mother.

BULLISH HARAMI

Bullish Harami - Small green inside large red
Bullish Harami - Small green inside large red
What it means: After a strong down move, a small bullish candle shows buying interest but hesitation.
Signal: Potential bullish reversal - sellers losing steam.
Nickname: "Pregnant Pause"

BEARISH HARAMI

Bearish Harami - Small red inside large green
Bearish Harami - Small red inside large green
What it means: After a strong up move, a small bearish candle shows selling interest but hesitation.
Signal: Potential bearish reversal - buyers losing steam.
Nickname: "The Pause Before the Storm"

HARAMI CROSS

   ┌───────┐
   │       │
   │   ┼   │ ←Doji (baby)
   │       │
   └───────┘
What it means: The second candle is a Doji, showing even more indecision.
Signal: Stronger reversal signal than regular Harami.

INSIDE BAR (Western Term)

An "Inside Bar" is the Western equivalent of Harami. The second bar's entire range (high to low) is contained within the first bar.

Trading Strategy:
- Wait for breakout above/below the mother candle
- Direction of breakout = trade direction
- Stop loss: Other side of the pattern

HIKKAKE PATTERN

A Hikkake is a FAILED inside bar:

1. Inside bar forms
2. Price breaks one direction
3. Then REVERSES and breaks the other direction

Signal: Very reliable because it trapped traders on the fake breakout.
Nickname: "The Trap" or "Fakeout Pattern"

Watch out

Harami patterns are WEAKER than engulfing patterns. They suggest hesitation, not conviction. Always wait for confirmation.

Key takeaways

  • Harami = second candle body is completely inside first candle body
  • Shows hesitation and potential reversal
  • Harami Cross (with Doji) is stronger than regular Harami
  • Hikkake is a failed inside bar - trades the reversal of the fakeout