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Bullish Hikkake Candle Pattern
The bullish hikkake candlestick pattern resembles a three inside down candle pattern but without the constraints. The bullish hikkake doesn’t require a rising price trend nor is candle color important as they both are in the three inside down candlestick.
Bullish Hikkake Candlestick: Important Results
The bullish hikkake is plentiful, so plentiful that I limited samples to 20,000. It ranks 16th out of 104 candle types, where 1 has the highest frequency.
The best average move 10 days after price closed above the top of the highest high or below the lowest low in the 3-bar candlestick was 4.97% in a bear market after an upward breakout. That’s short of the 6% or so that I like to see. That performance ranks 23rd where 1 is best out of 104 candles.
I setup my program to find hikkake’s based on the “Bullish Hikkake, Confirmed” pattern shown in the figure to the right. That includes the 3-bar hikkake and up to 3 additional days for confirmation. However, all of the numbers assume that confirmation occurs when price closes above the top of the 3-bar candle or below the bottom of the 3-bar hikkake pattern. That is how I measured the performance of all other candles. Theoretical performance: Bullish when confirmed (but can act as a reversal or continuation) Tested performance: Bullish continuation 52% of the time Frequency rank: 16 Overall performance rank: 84 (1 is best out of 105) Best percentage meeting price target: 60% (bull market, up breakout) Best average move in 10 days: 4.97% (bear market, up breakout) Best 10-day performance rank: 23 (bear market, up breakout) The above numbers are based on hundreds of perfect trades. See the glossary for definitions. |  Bullish Hikkake
Bullish Hikkake, Confirmed |
In theory, the hikkake is supposed to be a bullish candlestick, but it can act either as a reversal or continuation of an existing price trend. That’s what I found, too. My numbers say the confirmed pattern is a continuation 52% of the time, with upward breakouts more than twice as likely to occur as downward ones (13,584 vs 6,416 samples). That shouldn’t be a surprise because price is probably closer to the top of the confirmed candle than the bottom.
Bullish Hikkake Candlestick: Discussion
| Characteristic | Discussion |
| Number of candle lines | Three. |
| Price trend leading to the pattern | None |
| Configuration | Look for an inside day (lower high and higher low compared to the prior day) followed by a lower high and lower low. Candle color is not important for identification. |
| Confirmation | Price must rise above the high of the inside day — the second candle of the pattern — in three days or less, after the candle ends. See the ideal picture of “Bullish Hikkake, Confirmed” above. The red candle confirms the pattern on the third day when the high of that day rises above the blue line. The blue line touches the top of the inside day. |
Bullish Hikkake Candlestick: Identification Guidelines
Market, Breakout Direction
Rising Trend
Bull market, upward breakout
6.75%
Bear market, upward breakout
6.75%
Bull market, down breakout
4.60%
Bullish Hikkake Candlestick: Trading Tidbits
- Performance for tall hikkake candles is best in a bear market with gains or losses of almost 10% logged (meaning upward breakouts scored rises averaging 9.67% and downward breakouts showed losses of 9.64%). Tall means taller than about 5% of breakout price divided by the height of the 3-bar pattern.
- Breakouts below a 50-bar exponential moving average result in better performance in bull markets after upward breakouts: 6.62% versus 5.90%.
Bullish Hikkake Candlestick: Example
The chart on the right shows a bullish hikkake in 3M (MMM). I show the candle in the inset and it appears above the blue line on the chart.
The first two days are the inside day followed by a lower low and lower high. Often, you will see price make a large move down on the third day like that shown here, but that need not be the case. It could be a small candle providing both the high and low are below the prior candle’s high and low, respectively.
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