Are you one of the traders who enjoy the use of candlesticks to predict market movements? Even if you are, you may wonder how to trade a reversal. Candlesticks are easy to read and ideal for determining market activities. Have you ever heard of the Harami candlesticks? Not many have. But the experts say that the different patterns they form usually help them obtain the information they need to trade efficiently.

These are ideal for spotting reversals; they usually develop when a reversal is likely to take place. When the Harami appears, traders assume that the currency’s momentum is fizzling. The Harami looks like a small body inside the previous large candlestick. You’ll note that such candle is always bigger than the others that surround it.

When the market is bullish, it tells traders that the strength is diminishing due to the fact that the bulls are taking their earnings and closing their positions.

Note that there’s also a Harami cross. This formation appears as an extremely small body and can be even categorized as a Doji. The fact that it doesn’t depict a real body tells an online Forex participant that the previous movement is certainly running out of steam.

Another advantage about the Harami cross is that its highs and lows provide traders with the support and resistance levels for future currency price shifts.

Despite their practicality, experts often say to use primary candlesticks to confirm the information a Harami setup offers.