Just now I saw someone asking about the bearish marubozu pattern, and I think it’s worth discussing it properly. This candlestick pattern is actually very common in trading, but many people haven’t truly understood what it means.

In simple terms, a bearish marubozu is a red candlestick with absolutely no upper or lower shadows. The opening price is the highest point, and the closing price is the lowest point. In other words, from open to close, the sellers keep pressing down on the buyers, showing quite strong bearish power.

Why pay attention to this pattern? The key is where it appears. If, during an uptrend, a bearish marubozu suddenly shows up, what might that indicate? A reversal signal. Buying pressure is fading, and the sellers begin to take over. But be careful—don’t just look at this one candle and rush to short. It’s best to wait for the next candle to confirm; if it also closes downward, the success probability is much higher.

Conversely, if the market is already in a downtrend and a bearish marubozu appears, it’s a signal of trend continuation. The bears are still controlling the situation, and the decline may continue.

How do I handle it in actual trading? This is what I usually do: after seeing the bearish marubozu, I enter a short when the next candle’s opening price is below the close of this pattern. Alternatively, you can wait until it breaks below nearby support levels before entering. For the stop-loss, I set it just above this candle’s opening price, so the risk is relatively more manageable.

As for target levels, I look at the next major support area, or use Fibonacci retracement levels and the previous lows as references. If you want to maximize returns, you can also use a trailing stop so your profit “slides” along with the price as it moves down. The key is not to be greedy—confirm the signal before taking action.