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Opening White Marubozu Candle Pattern
My book, Encyclopedia of Candlestick Charts
, pictured on the left, takes an in-depth look at candlesticks, including performance statistics.
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Opening White Marubozu Candlestick: Important Results
Theoretical performance: Continuation Tested performance: Continuation 54% of the time Frequency rank: 7 Overall performance rank: 75 Best percentage meeting price target: 71% (bear market, down breakout) Best average move in 10 days: -4.37% (bear market, down breakout) Best 10-day performance rank: 37 (bull market, down breakout) All ranks are out of 103 candlestick patterns with the top performer ranking 1. “Best” means the highest rated of the four combinations of bull/bear market, up/down breakouts. The above numbers are based on hundreds of perfect trades. See the glossary for definitions. |  Opening White Marubozu |
Opening White Marubozu Candlestick: Discussion
As I mentioned in the introduction, the opening white marubozu candlestick is not a star performer. In fact, it acts almost randomly — 54% of the time price continues the prevailing trend after the breakout. Ten days after the downward breakout in a bear market, price declined an average of 4.37% over that span. That is the best showing among the four categories of bull/bear market and up/down breakouts that I looked at. A good showing would be a drop of at least 6%, so the opening white marubozu falls well short. The performance rank over 10 days agrees with my assessment. The candle ranks 37th. That is the same position that I had in my graduating high school class, but I had more than 103 classmates to compete against.
Opening White Marubozu Candlestick: Three Trading Tidbits
- Opening white marubozu candles that appear within a third of the yearly low perform best — page 539.
- Opening white marubozu within a third of the yearly high frequently act as continuations — page 541.
- Volume gives performance clues — page 540.
Opening White Marubozu Candlestick: Example
Both of these opening white marubozu candles appear in an upward price trend. The breakout, which is a close above the top of the candle (upward breakout) or below the bottom of the candle (downward breakout) is upward in both cases. A study I conducted and discussed in my Encyclopedia of Candlestick Charts book is that a minor high or low occurs within a day (plus or minus) of a tall candle between 67% (minor high) and 72% (minor low) of the time. You can see that at B. Price peaks a day later and then reverses. Traditional candle theory says that after an opening white marubozu, you can expect a nice long price run. My statistical research suggests otherwise.
Of all the things I’ve lost, I miss my mind the most.
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