Introduction
A bullish harami is a two-candle reversal pattern that forms at the end of a downtrend, beginning with a long bearish candle followed by a small candle whose body sits entirely within the first candle’s body and closes above its close. The pattern shows that selling pressure has stalled and a move higher may be starting.
Three things decide whether a bullish harami is worth trading: the structure of the two candles, the level the pattern forms on, and what the next candle does. Traders who check all three filter out most of the failures. Traders who check only the structure are close to flipping a coin.
What Is a Bullish Harami Pattern?
A bullish harami is a candlestick pattern made of two candles that signals a possible end to a downtrend. The first candle is a long bearish candle that continues the existing selling. The second is a small candle that opens and closes inside the body of the first, and closes above the first candle’s close.
The name comes from Japanese. Harami means pregnant, and the pattern is named for its shape: a large body carrying a small body inside it. Japanese rice traders were using the term centuries before candlestick charts reached Western markets.
A candlestick shows four prices for one period: the open, the high, the low and the close. The candle body is the distance between the open and the close. The thin lines above and below the body are the wicks, and they mark the high and the low of the period. When the close sits below the open the body is bearish, usually drawn red. When the close sits above the open the body is bullish, usually drawn green.
The bullish harami belongs to the family of reversal candlestick patterns, alongside the bullish engulfing, the hammer and the morning star. Its opposite, the bearish harami, forms at the top of an uptrend and warns of a move down.
For traders the appeal is the entry. The pattern marks a point where selling has stalled while price is still near the low of the move, so a long position opened here sits close to the level that would prove it wrong.
How Do You Identify a Bullish Harami Candlestick Pattern?
Identifying a bullish harami takes 3 checks. Bullish harami candlestick patterns must have an existing downtrend, first long bearish candle, and second smaller candle within the first candle’s body.
1. There must be a downtrend already in place. The harami candlestick pattern is a reversal signal, so it needs something to reverse. The same two candles inside a sideways range carry no information.
2. The first candle is a long bearish candle. Its body should be clearly larger than the candles around it. This candle continues the downtrend and often marks the point where selling looks strongest.
3. The second candle has a small body that sits inside the first candle’s body. Both the open and the close of the second candle fall between the open and the close of the first. This is the defining condition. The containment applies to the bodies only, so the wicks of the second candle can extend past the first candle’s body without breaking the pattern. A tighter second candle is a cleaner signal.
One point on timeframes. Many descriptions say the pattern takes two days to form. but it really takes two candles on whatever timeframe you are charting.
What Is a Bullish Harami Cross?
A bullish harami cross is a bullish harami where the second candle is a doji. A doji opens and closes at almost the same price, so it has virtually no body and prints as a cross or a plus sign.
Everything else is the same. There is a downtrend, a long bearish first candle, and a second candle contained inside the first candle’s body.
The cross version is generally read as the stronger of the two. A doji means buyers and sellers finished the period at the same price immediately after a wide down candle, which is a sharper stall than a small directional candle shows. The confirmation rules below still apply in full.
What Does a Bullish Harami Pattern Tell You?
A bullish harami tells you that selling pressure has dropped off. It does not tell you that an uptrend has started.
Look at what happened across the two candles. On the first, sellers pushed price down through a wide range and closed near the low. On the second, price stayed inside that range and closed higher than the previous close. The sellers who were in control one period earlier could not extend the move.
Three things usually produce that second candle. Sellers stop adding to positions. Traders who are already short begin closing, and their buying supports price. Buyers who have been waiting for the downtrend to slow start taking small long positions. Any of the three narrows the range.
The narrowing itself is the signal. A wide range followed by a narrow range inside it is a contraction in volatility, and contractions tend to resolve with an expansion. What you are trading is the direction of that expansion. The harami tells you a decision point is close. It says nothing about which way the decision goes, which is why the pattern needs confirmation before you act on it.
A useful way to hold this: treat the bullish harami as the signal to start watching, and the candle after it as the signal to trade.
Pro Tip: The same two candles sitting on a prior swing low and sitting in the middle of a range are two completely different trades.
How Do You Trade the Bullish Harami Candlestick Pattern?
To trade bullish harami candlestick pattern effectively, you must have at least 3 elements: Pattern formation near major S/R (Support / Resistance) zones, Entry Price Level, and Stop Loss.
Where Do You Set Entry, Stop Loss and Take Profit on a Bullish Harami?
Entry.
There are two common entry methods, and they trade speed against reliability.
The first is to enter on the close of the confirmation candle, which is the candle that comes after the harami. You wait for that candle to close above the high of the second candle, then buy. This gets you a worse price and a higher proportion of trades that work.
The second is to place a buy stop order just above the high of the first candle. If price trades up through that level you are filled automatically. You get a better price and you take more trades that fail, because price can poke above the level and drop straight back.
Earlier entries allow you to ride the wave longer hence more profits but later entries are safer and more reliable but you will lose a significant portion of the price trend.
Stop loss.
Place the stop below the low of the first candle.
The most common error with this pattern is putting the stop below the low of the small second candle. It looks tighter and it sits inside the normal noise of the setup. Price routinely dips under the second candle’s low and then rallies, which stops you out of a trade that was working. The level that actually invalidates the pattern is the low of the first candle. Below that, the downtrend has resumed and the reason for the trade has gone.
Important: The level that invalidates a bullish harami is the low of the first candle. A stop placed under the small second candle sits inside the setup’s own noise.
Take profit.
Use Major S/R Zones. The first target is the nearest resistance level above entry where price has already reversed: a prior swing high, the top of a recent range, or a level that has turned price at least once before.
Position sizing
Additionally, position sizing is one of the most important parts of risk management in trading. Size your position from the stop distance rather than the target. Decide what percentage of your account you are willing to lose on the trade, measure the distance from entry to stop, and calculate the position size from those two numbers. A bullish harami with a wide first candle produces a wide stop, which means a smaller position for the same risk.
Why Does the Location of the Bullish Harami Matter?
A bullish harami that forms at a level where price has already reversed shows you a clear sign of momentum through price action. The pattern is telling you that selling has stalled at the same place buyers stepped in before. Levels worth marking include:
A prior swing low
The lower boundary of a trading range
A level that produced a sharp bounce earlier in the same move
A moving average the market has respected throughout the trend
A bullish harami that forms in open space is unreliable. Price has stalled at a level with no history, so there is no reason to expect buyers to be waiting there.
The practical check takes ten seconds. Before you take the trade, zoom out one timeframe higher, i.e. from Day to Week for example, and see whether the higher timeframe shows the same trend as the lower timeframe originally.
The second location filter is the trend itself. A bullish harami after a long, extended decline has more room to run than one that forms after three down candles. Reversal patterns need something to reverse, and the more stretched the move that precedes them, the more short positions are open that eventually have to be closed.
How Do You Confirm a Bullish Harami Pattern?
The reason this matters is the failure rate. The harami pattern forms often, particularly on lower timeframes, and plenty of those lower timeframe patterns fail, thus, justifying the need for a confirmation rule.
How Do You Confirm a Bullish Harami With Volume and the Next Candle?
The confirmation candle with Volume Breakout after contraction. The strongest confirmation is a new bullish candle that closes above the high of the first candle that is accompanied with breakout on volume after an initial volume contraction.
Volume. Volume should follow a specific shape across the three candles.
The first candle usually carries a heavy volume. Sellers are active and the range is wide.
The second candle should carry lower volume than the first. This is what a contraction looks like in volume terms: fewer participants, narrower range. Heavy volume on a small-bodied second candle is a warning sign, because it means a large amount of trading produced almost no price movement and sellers may still be absorbing every bid.
The confirmation candle should carry volume above the second candle and ideally above the average of the last several candles. A confirmation candle that closes above the first candle’s high on light volume is the single most common way this pattern fails.
In forex there is no centralised volume figure, so use the tick volume your platform reports. It counts price changes rather than contracts traded, and it tracks real activity closely enough for this comparison.
How Do You Confirm a Bullish Harami With RSI and MACD?
RSI and MACD both measure momentum, and both are useful here for the same reason. They tell you whether the selling that produced the first candle was already weakening before the harami formed.
Using RSI to confirm Bullish Harami Candlestick Setup
RSI Level and Divergence is important here. The first is the level: an RSI below 30 when the harami forms tells you the downtrend is stretched and a bounce is more likely. The second is divergence. If price made a lower low on the first candle while RSI made a higher low than at the previous swing, selling momentum is fading even as price falls. A bullish harami that forms on a bullish RSI divergence is a stronger setup than one that forms without it.
Using MACD to confirm Bullish Harami Candlestick Pattern
Watch the histogram before the crossover. Histogram bars that are still negative but getting shorter mean downside momentum is shrinking. That contraction usually appears a few candles ahead of the MACD line crossing above the signal line. If the histogram is contracting when your harami forms, the two signals agree.
Both indicators lag the candles, since both are calculated from closes that have already happened. Use them to confirm what the candles are showing rather than to generate the entry.
How Do You Confirm a Bullish Harami With Fibonacci Retracements?
Fibonacci retracements give you a set of levels where a pullback is likely to end. When a bullish harami forms at one of those levels, you have two independent reasons to expect a bounce at the same price.
Draw the retracement from the low to the high of the last significant up move, then watch the 38.2%, 50% and 61.8% levels as price pulls back into them. Certain signals like a bullish harami whose low sits at or just under one of these levels, and which closes back above it, proving that the support is strong and reversal in momentum is taking place.
The 61.8% level is the most important level. A pullback that reaches it has given back most of the prior advance, so the risk on a long taken there is measured against a nearby invalidation point.
What Does a Bullish Harami Look Like on a Real Chart?
Here is a bullish harami that formed on the EUR/USD daily chart in July 2026, step by step.
[CHART: EUR/USD daily, OANDA. Mark the 27 and 28 July candles, the 29 July confirmation candle, and the entry, stop and target levels.]
The setup. EUR/USD fell through the back half of July, rolling over from the mid-July high and grinding down through a run of red candles into the 1.1370 area. By 27 July price had come back into the band where it last based in late June, which is the most recent place the market had found buyers.
The first candle. 27 July opened at 1.13958, sold off through the session and closed at 1.13683, near its low. The body measures 27.5 pips and the full range is 51.4 pips. Volume came in at 96.73K. On its own this is the downtrend continuing.
The second candle. 28 July opened at 1.13686, traded between 1.13532 and 1.14053, and closed at 1.13864. Both the open and the close sit inside the previous body, and the close is 18 pips above the 27 July close. The bullish harami is valid.
Look at what actually contracted. The body shrank from 27.5 pips to 17.8 pips and shifted higher inside the previous body, while the total range barely moved at all, 51.4 pips against 52.1 pips. The containment is in the bodies, which is all the pattern requires. Volume stepped down from 96.73K to 87.15K, which is the participation side of the same contraction.
Location check. The 28 July low of 1.13532 is the lowest point of the two-candle structure, and it sits inside the late-June base. The pattern is forming on a level with history rather than in open space.
Confirmation. 29 July opened at 1.13904 and closed at 1.14668, a 76-pip body that took price clean above the 27 July high of 1.14184. Volume came in at 141.96K, roughly 1.6 times the previous candle and the heaviest reading of the whole move. That is participation arriving behind the break, and it is what separates a confirmation candle you can act on from one you cannot.
The trade. Note where the stop belongs. The 28 July low of 1.13532 is 14 pips below the 27 July low of 1.13670, so the invalidation level belongs to the second candle here, not the first. A stop just under it at 1.13500 is the correct placement.
The two entry methods produced very different trades. A buy stop above the 27 July high filled at 1.14184, giving 68 pips of risk. Waiting for the 29 July close meant entering at 1.14668, which is 48 pips worse and 117 pips of risk for the same idea. When the confirmation candle is this large, the earlier entry is worth a lot.
The result. The measured move gives a first target of 1.14698, which is the 51.4-pip range of the first candle projected up from the 1.14184 entry. The 29 July candle reached 1.14709 intraday, so the first target was hit the same session it was entered.
Price then held above that level rather than rejecting it. It ran into the 1.1550 area by mid-August, worth about 1.9 times the initial risk, and above 1.1700 by 19 August, worth roughly 4 times it.
If you’re observant, you might’ve noticed that on the same chart: a second bullish harami formed around 12 August and worked just as cleanly, which is a useful reminder that this setup repeats on the same instrument more often than most traders expect.
When Does the Bullish Harami Pattern Fail?
A bullish harami fails when price closes back below the low of the first candle after the pattern completes. Here is what usually causes that.
Confirmation never arrives.
The most frequent failure is a trade taken on the harami itself. The pattern shows a pause. Acting on a pause without waiting for the candle that follows could be doable and gives your more profit too since you can buy lower but this also means you can fail a lot. That is why many traders prefer to give up some profit to secure a safer bet.
The pattern forms mid-range.
A harami with no Support level underneath it fails at a far higher rate than one sitting on a major support zone.
The downtrend is too strong.
If the first candle sits inside a run of large bearish candles with no pullbacks at all, a single small candle is unlikely to be the reversal.
The second candle sits low in the first candle’s body.
A second candle whose body sits near the top of the first candle’s range shows a stronger recovery. When the small body hugs the lows, buyers have done very little to push the price up.
Volume never expands.
If the confirmation candle arrives on volume below the recent average, the move up has much lesser participation for a good reversal.
A higher timeframe level sits directly overhead.
A bullish harami on a 15-minute chart forming just under a daily resistance level is trading into a wall. Always check the higher timeframe and see if the trend aligns.
Bullish Harami vs Bullish Engulfing: Which Pattern Is Stronger?
Both patterns are two-candle bullish reversal signals that form at the end of a downtrend. The difference is the order and the relative size of the two candles.
In a bullish harami, the large candle comes first and the small candle sits inside it. In a bullish engulfing, the small candle comes first and the large bullish candle that follows covers it completely.
The bullish engulfing is the stronger of the two. In an engulfing pattern, buyers have already taken back the entire range of the previous candle inside a single period, which is a completed shift in control. In a harami pattern trade, buyers have only stopped the fall. The shift has yet to happen and it may never happen.
The harami has one advantage. Because the entry sits closer to the low of the move, a harami trade that works carries a tighter stop than an engulfing trade on the same setup. You are risking less money with a lower success rate.
In practice, traders use the harami as an early alert and the engulfing as a trigger. A downtrend that produces a harami and then an engulfing candle over the following periods is a stronger sequence than either pattern on its own.
Bullish Harami vs Bearish Harami: What Is the Difference?
The two patterns are mirror images. The structure is identical, and the trend context and signal direction are reversed.
A bearish harami forms at the top of an uptrend. The first candle is a long bullish candle and the second is a small candle contained inside it that closes below the first candle’s close. The reading is that buying pressure has stalled and a move down may follow.
The confirmation rules mirror as well. For a bearish harami you want the next candle to close below the low of the first candle, on expanding volume, with the pattern sitting at a level that has capped price before.
One practical note. A harami candlestick is direction-neutral until you look at the trend that came before it. The same two-candle shape appearing after a rally and after a decline carries opposite meanings, so establish the trend first and classify the pattern second.
Frequently Asked Questions
Is a bullish harami a buy signal?
A bullish harami works as an alert rather than a buy signal on its own. It tells you selling has stalled. The buy signal is the candle that follows: a bullish candle closing above the high of the first candle, on volume above the recent average. Traders who buy on the harami itself take on the pattern’s full failure rate for a few pips of better entry.
Does candle colour matter in a bullish harami?
Colour is a shorthand and the underlying rule is what matters. The second candle must close above the first candle’s close, and its body must sit inside the first candle’s body. Most of the time that produces a green second candle, which is why the pattern is usually described that way. A second candle that opens higher and closes slightly below its own open will print red and can still be a valid bullish harami if its close is above the previous close. Check the closing prices rather than the colours.
Can a bullish harami appear in an uptrend?
Yes, and it means something different when it does. Inside an uptrend, a bullish harami usually forms during a pullback after a few down candles. There it reads as a continuation signal: the pullback is stalling and the uptrend may resume. The structure is identical and the trade is a long in both cases, though the context changes the target. A harami at the end of a downtrend is trading a reversal against the prevailing move. A harami inside an uptrend is trading a resumption, which tends to run further because it moves with the larger trend.
