Bearish Harami

Anatomy

The first candle is a large green body. The second is a small red (or small) body that sits entirely inside the first body’s range. The small candle is the "baby" nested inside the larger green one.

Market psychology

After a session of strong buying, the next session opens lower and stays in a narrow range. The failure to make new highs shows buying pressure is fading, even before sellers fully take control.

When it matters

Meaningful after an uptrend, ideally near resistance. Like its bullish twin, it is a softer, earlier warning than an engulfing — it shows hesitation, so confirmation on the next candle matters.

Common beginner mistakes

• Confusing it with a bearish engulfing — in a harami the small candle is inside the big one, not engulfing it.
• Treating it as a confirmed top; it shows momentum cooling, not a power shift to sellers yet.

Frequently asked questions

How reliable is a bearish harami?

It is a moderate, early warning — weaker than a bearish engulfing. It is most useful at resistance after an uptrend with a confirming red candle the next session. Alone it just shows the rally hesitating.

Does the inside candle need to be red?

A red inside candle is the classic bearish harami and the more reliable read. A small green inside candle still shows contraction but the bearish interpretation is weaker.