The word harami comes from an old Japanese term for "pregnant" — and once you see the pattern, the name makes sense. A large candle is followed by a small one nestled inside it, like a body carrying a smaller one. It's a subtle but useful sign that a trend may be running out of steam.
What a harami looks like
A harami is a two-candle pattern with two defining features:
- A large candle in the direction of the current trend.
- A small candle whose body is completely contained within the range of the previous body — and is the opposite colour.
So after a strong up-move, a large green candle is followed by a small red one that fits inside it. After a down-move, a large red candle is followed by a small green one inside it.
What it's telling you
The message of the harami is hesitation. A powerful trend candle is suddenly followed by a small, opposite-coloured candle that can't extend the move. That loss of momentum suggests the side in control is tiring — a possible pause or reversal.
Note the harami is milder than an engulfing pattern. Where an engulfing candle overwhelms the previous one, a harami simply shrinks inside it. It's a whisper of a turn, not a shout.
The harami cross
There's a stronger variation. When the small second candle is a doji (open and close nearly equal), the pattern becomes a harami cross. Because a doji shows even deeper indecision than a small body, the harami cross is generally treated as a more significant warning that the trend may be turning.
Warning
A harami signals hesitation, not a confirmed reversal. On its own it's weak — wait for the next candle to confirm the direction before acting on it.
How to trade a harami sensibly
Because the harami is a gentle signal, context and confirmation matter more than usual:
- Check the trend. A harami means most after a clear up- or down-move, at a logical support or resistance level.
- Wait for confirmation. A follow-through candle in the new direction turns a whisper into something tradeable.
- Use a stop loss. Place it beyond the large first candle so a failed signal caps your risk.
Risk
Weak signals fail often. Never trade a harami in isolation — combine it with trend, key levels and confirmation, and always protect the position with a stop loss.
Practise spotting subtle signals
Harami patterns are easy to miss until you've trained your eye. A regulated broker with a free demo lets you spot them on live charts before risking money.
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