Harami Pattern for binary options

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Harami Pattern for binary options

Another pattern that should be analysed for binary options trading is Harami pattern, made by only 2 candles. Let’s see together how it’s structured. First of all we should say that it can be both upward (Harami Bullish) and downward (Harami Bearish) and its task is anticipating a possible inversion of trend.

Here on the left you can see an Harami bullish pattern that is made by the two simple candles you find underlined into the gray oval. These two candles must be at the end of a downward trend and indicate that we are approaching an upward stage. The first candle is obviously red and with an evident body, the second one must be smaller than the first one, no matter which colour (it can be red or green) and its body should be preferably placed in the middle of the first candle body. What does this last feature mean? Generally a candle starts where the previous one ends. The fact that the opening price of the second candle in this pattern must be higher than the closure price of the first one, means that the market suffered a sort of shake, a sort of upward frenzy which tells us that the closure price of the first candle isn’t the price that the market wants in such moment and so it’s necessary to heighten it. The more the starting trend is greatly downward, the more this pattern seems acquiring power. The fact that the body of the second candle is smaller than the previous one means that there’s indecision and so the large fall is put at risk and an upward stage could occur.

Here on the left you can see a bearish Harami pattern, made by two candles that announce us a new downward stage immediately after the upward one just concluded. In this case too, the conformation is the same as the previous one, but the first of the two candles is green and the second one is much smaller and should open lower than the closure of the first one. This indicates a strong indecision of the market with the possible development of an inversion of the trend.

How can we use Harami pattern for binary options?

Let’s start saying that this type of pattern seems more effective with high time frames, for example 1 day, 4 hours or 1 hour, but in the meantime it shouldn’t be undervalued for short time frames, such as 1, 5 or 10 minutes.

At the closure of the second candle of the pattern we can try to invest in the opposite direction as to the one of the trend that precedes Harami pattern. So in case of an Harami Bullish pattern we will invest upward while in case of an Harami Bearish we will invest downward. The option expiration, in my opinion, shouldn’t be too far: from 2 to 5 candles maximum from the considered time frame could be a good strategy to trade with binary options exploiting Harami pattern.

As always pay attention and be aware that there’s no guarantee of success. The only thing we can say is that the experience often proved we were right using this strategy, that can be decidedly profitable.

If you want to try it on paper or with a demo account, you can post the results you obtained in the comments area below, so that we can analyse them together.

72# Harami Binary Options Strategy

Harami Binary

Submit by Sorin 12/08/2020

Harami Binary Options strategy It’s based on the patterns Bullish harami and bearish Harami.

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Harami pattern is created by two candlesticks with 2 colour, the 2nd candle of the pattern is more compact and completely contained within a of the previous candle body.

I show Harami Binary Strategy also with stochastic filter.

Time Frame 4H. 6H, 8H, 12H, daily Time Frame.

Expires time recommended Two Bars.

Technical Financial indicators

Harami pattern ( Bullish Harami, and bearish Harami),

Stochastic (4, 1,2,) with smoothed moving average (1, 1).

When appears Bullish Harami open buy Call at the open of the third bar.

Filter: Stochastic line is > moving average.

When appears Bullish Harami open buy Put at the open of the third bar.

Filter: Stochastic line is

In the pictures Harami binary options strategy.

Harami Candlestick Chart Pattern In Binary Options Trading

Candlestick patterns are very helpful in identifying potential directions and changes in the market when trading binary options. The Harami candle pattern is one of the most useful.

Harami Candlestick Chart Pattern In Binary Options Trading

Here, we will show you step-by-step, how you can apply the Harami candlestick chart pattern to your binary options trading strategy.

How to identify a basic Harami pattern

A Harami candlestick pattern has several distinct attributes. The pattern features two candles: the first is a bullish and large candle and a second smaller candle follows it. This second candle should not close outside the body of the first candle—this is perhaps the best way to identify the Harami pattern. To confirm that the Harami is forming, check to see that the second small candle has closed above the traded value of the body of the first candle.

When a bearish Harami forms, there is usually an end to the bullish market. However, a bearish Harami pattern is typically weak because it is not necessarily an indication of a complete market reversal. As such, the Harami pattern requires a third candle for one to fully confirm that the pattern has formed.

Applying the Harami candlestick pattern to your trading strategy

Traders can apply the bearish Harami candlestick pattern to any trending trading strategy. When this pattern appears, it is possible to profit from long trades or to trade a complete reversal.

As you start applying the Harami pattern, you will inevitably come across the Doji Candlestick. When you identify a Doji candlestick, it is a possible indication that a reversal might take place soon, giving you a good opportunity to enter the market.

Dojis are typically made up of one candle. This candle closes and opens close to the same level. The candlestick is also composed of a lower and upper wick that is out of the body and takes a positive (+) sign. The candle that follows the Doji indicates the most appropriate trade preference you should demonstrate at that particular time.

As soon as a Doji pattern forms, it is important for traders to take notice of the other moving averages. This will help to identify whether the pair is close to support level, where candlestick patterns demonstrate the highest potency.

So let’s go back to the Harami pattern…

The Harami is a strong Doji pattern because it assesses each candle on each side of the Doji to provide you with a clear indication of the direction of the market. The candle that comes before the Doji should face in the direction of the prevailing trend while the real body will be bigger than the Doji’s body. The candle that comes third after the Doji will approve the reversal trend if it goes against the direction of the first candle or disconfirm the Harami pattern if the prevailing trend continues after the Doji.

In summary, the first Harami candle before the Doji pattern is large and it continue with the immediate trend. Meanwhile, the Doji itself is a small candle. The second candle that makes up the Harami pattern will give an indication when the Doji causes a reversal or continues the trend set by the first candle. The Harami can be very effective at identifying a reversal at the right time, allowing you to take advantage of the lucrative risk: reward ratio.

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