What Is a Bullish Harami? Candlestick Pattern Explained

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A bullish harami is a two-candle reversal pattern that appears after a decline: a long bearish (black or red) candle is followed by a small bullish (white or green) candle whose real body sits entirely inside the first candle’s real body. It suggests that selling pressure may be fading and a downtrend could be ending. On its own it signals hesitation among sellers, not a confirmed reversal.

The name comes from an old Japanese word meaning “pregnant”: the small second body tucked inside the large first one resembles a pregnant figure, so it is sometimes called the pregnant candlestick pattern.

How the Harami Candlestick Pattern Forms

A valid bullish harami pattern has three parts:

1. Context. Price has been falling. A harami that forms in a sideways range or after a rally is not a bullish reversal signal.
2. Candle one. A long bearish candle that extends the decline and shows sellers in control.
3. Candle two. A small bullish candle that opens and closes within the first candle’s real body. The second body is often less than half the size of the first.

Strict definitions require the second candle’s entire range, shadows included, to fit within the first body. Looser definitions only require the bodies to nest. Charting software varies too, so a harami flagged by one platform’s pattern scanner may not meet another’s rules.

Interpreting a Bullish Harami

The first candle shows sellers pushing price sharply lower. On the next session, price opens above that close (often a gap up in stocks) and trades in a narrow band without making a new low. The contraction from a wide range to a narrow one is the message: the selling momentum of the previous candle did not continue.

That is why the pattern reads as indecision rather than strength. Buyers have not taken over; they have only stopped sellers from extending the move. A harami cross, where the second candle is a doji with nearly equal open and close, is often treated as a stronger hint of indecision because the market finished exactly where it started after a heavy down day.

Example of a Bullish Harami

In a hypothetical example, a stock has fallen for several sessions. On day 1 it opens at $50.00 and closes at $46.00, a $4.00 bearish body, with a low of $45.60. On day 2 it opens at $46.80, trades between $46.50 and $47.90, and closes at $47.60. The day 2 body ($46.80 to $47.60) sits fully inside the day 1 body ($46.00 to $50.00), so the pair forms a bullish harami. Because day 2’s high and low also stay inside the first body, it meets the strict definition as well.

A trader has several common entry choices:

• Confirmation close: wait for a later candle to close above the day 2 high ($47.90) or, more conservatively, above the day 1 open ($50.00).
• Stop placement: put a protective stop below the pattern low ($45.60), since a new low would invalidate the reversal idea.
• Sizing: the distance from entry to stop sets the risk per share. With entry at $48.00 and a stop at $45.50, the risk is $2.50 per share. A position size calculator turns that distance and an account risk limit into a share or lot size.

How Traders Use the Bullish Harami

Because the signal is weak by itself, traders usually look for it where other evidence points the same way:

• At support: a harami at a prior swing low, a trendline or a retracement level carries more weight than one in open space.
• With momentum readings: an oversold or bullish-divergence reading on the Relative Strength Index (RSI) can support the case that the decline is losing force.
• With volatility context: comparing the first candle’s range with the Average True Range (ATR) shows whether it was truly a “long” candle for that market, and ATR also helps set stops wider than normal noise.

Limitations of a Bullish Harami

• It needs confirmation. The pattern often appears as a pause before the downtrend continues, so acting before a confirming candle raises the chance of buying into further losses.
• Timeframe matters. On very short intraday charts, small inside candles form constantly, so the pattern loses meaning. No fixed rule says how long a bullish move will last after a harami on any timeframe.
• Forex quirks. Currency markets trade almost continuously, so the next candle often opens at or near the prior close rather than gapping. Many forex traders therefore relax the containment rule, which makes the pattern more common and less selective.
• No price target. The harami suggests direction, not distance. Exits depend on other tools.

Bullish Harami vs. Similar Patterns

Bearish harami. The reverse setup: a long bullish candle in an uptrend followed by a small bearish candle inside its body, warning that a rally may be stalling. The same nesting shape carries opposite meanings depending on the prior trend.

Bullish engulfing. Also a two-candle bottom, but the sizes flip. In an engulfing pattern the second bullish body is larger and fully covers the first bearish body. Engulfing shows buyers overpowering sellers. A harami shows only that selling has slowed.

Inside bar. Price action traders call any candle whose high and low fall within the prior candle’s range an inside bar, regardless of color or trend. A strict bullish harami is a specific inside bar with direction and context attached.

FAQs

The Bottom Line

Traders watching for bottoms in stocks or forex can use the bullish harami as an early warning that selling is slowing, but it gives no confirmed reversal and no price target. The pattern carries more weight at support or alongside RSI and ATR readings. Waiting for a confirming candle and sizing positions from the stop distance limits the cost of a failed signal.