Abandoned Baby Bottom is a three bar bullish trend reversal Candlestick pattern which is more similar to Morning Star. It is more reliable, when it occurs in the sharp decline or in downtrend. The candle body & shadows will not overlap between first & second bars and second & third bar. This pattern reorganize the shift in momentum from bears to bulls.
In western world, the Abandoned Baby Bottom is also called as Island Bottom reversal.
It represents the fight between the buyers and sellers and eventually the buyers win it. Starting of the pattern, the sellers will have momentum by creating the gap down. They will lose the momentum in the next day by creating the gap up. Literally there will be a territory where there was no trade happened.
In western world, the Abandoned Baby Bottom is also called as Island Bottom reversal.
Structure of Abandoned Baby Bottom
- The first candle will be in the bearish or more bearish signal.
- The second candle will have gap down opening and will close below first candle's low.
- Third candle will have gap up opening and close above second candle's high.
It represents the fight between the buyers and sellers and eventually the buyers win it. Starting of the pattern, the sellers will have momentum by creating the gap down. They will lose the momentum in the next day by creating the gap up. Literally there will be a territory where there was no trade happened.