Marubozu
Tue, Apr 15A Marubozu is a tall Japanese candlestick characterized by the absence of upper or lower shadows (or wicks). This candlestick pattern can be found in both bearish (red or black) and bullish (green or white) forms, making it easy to recognize due to its elongated body, resembling a vertical rectangle.
To identify a Marubozu candlestick pattern, look for the following criteria:
- The single candle involved in the signal should have a long body.
- There must not be an upper or lower shadow (or wick).
- The candle can be white/green or black/red, and it can appear anywhere on the chart.
A white/green Marubozu indicates an upward movement and is considered very bullish, while a black/red Marubozu signifies a downward movement and is regarded as very bearish. The longer the candle, the stronger the price movement. A bullish Marubozu is referred to as a White Marubozu, and a bearish Marubozu is called a Black Marubozu.
The term marubozu translates to “bald head” or “shaved head” in Japanese, which reflects the candlestick’s lack of shadows. When you observe a Marubozu candlestick, the absence of shadows indicates that the session opened at the highest price and closed at the lowest price of the day. In a bullish Marubozu, buyers maintained control of the price throughout the session, from opening to closing. Conversely, in a bearish Marubozu, sellers controlled the price from opening to closing.
To analyze a specific Marubozu more effectively, consider the following:
- If a White Marubozu appears at the end of an uptrend, a continuation is likely.
- If a White Marubozu appears at the end of a downtrend, a reversal is likely.
- If a Black Marubozu appears at the end of a downtrend, a continuation is likely.
- If a Black Marubozu appears at the end of an uptrend, a reversal is likely.
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