As of 12/20/2024   Indus: 42,840 +498.02 +1.2%     Trans: 15,892 +32.54 +0.2%     Utils: 986 +14.76 +1.5%     Nasdaq: 19,573 +199.83 +1.0%     S&P 500: 5,931 +63.77 +1.1%	YTD  +13.7%   0.0%    +11.9%    +30.4%    +24.3%	Targets    Overview: 12/12/2024     44,200 or 41,750 by 01/01/2025   16,100 or 17,700 by 01/01/2025   1,050 or 975 by 01/01/2025   20,500 or 19,300 by 01/01/2025   6,100 or 5,775 by 01/01/2025
Chart Pattern Indicator: on 12/5/24

As of 12/20/2024   Indus: 42,840 +498.02 +1.2%     Trans: 15,892 +32.54 +0.2%     Utils: 986 +14.76 +1.5%     Nasdaq: 19,573 +199.83 +1.0%     S&P 500: 5,931 +63.77 +1.1%	YTD  +13.7%   0.0%    +11.9%    +30.4%    +24.3%
Targets    Overview: 12/12/2024     44,200 or 41,750 by 01/01/2025   16,100 or 17,700 by 01/01/2025   1,050 or 975 by 01/01/2025   20,500 or 19,300 by 01/01/2025   6,100 or 5,775 by 01/01/2025
Chart Pattern Indicator: on 12/5/24

Bulkowski on Above The Stomach Candlestick

My book, Encyclopedia of Candlestick Charts, pictured on the left, takes an in-depth look at candlesticks, including performance statistics.

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Above the stomach is a simple candlestick pattern and yet it works very well, functioning as a bullish reversal 66% of the time. You can also spot it often because it has a frequency rank of 32 out of 103 candle patterns, where 1 is most often.

Details about the pattern are sketchy, though. According to one website I checked, the candle is a two line pattern that appears in a downward price trend. The first candle is black and the second is white with a body at or above the midpoint of the prior candle's body.

Above The Stomach: Important Results

Theoretical performance: Bullish reversal Tested performance: Bullish reversal 66% of the time Frequency rank: 32 Overall performance rank: 31 Best percentage meeting price target: 61% (bull market, up breakout) Best average move in 10 days: -4.86% (bear market, down breakout) Best 10-day performance rank: 33 (bear 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.

Above The Stomach

Above The Stomach: Discussion

The above the stomach candle is an easy one to find. Look for two candles in a downward price trend. The first one is black and the second is white. The body of the second should be at or above the middle of the first candle's body. In other words, the opening and closing prices of the second day must be above the mid point of the first candle's body.

The candle represents a bullish reversal both in theory and reality, according to my testing. The above the stomach pattern reverses the downtrend 66% of the time, which is a good score. The overall performance rank is 31, which is far from 1, but is nevertheless a decent showing.

The above the stomach candle exhibits its best performance 10 days after the breakout by dropping an average of 4.86% in a bear market, ranking 33rd out of 103 candlestick patterns, where 1 is best.

Above The Stomach: Identification Guidelines

Above The Stomach: Three Trading Tidbits

If you want a few bones from my Encyclopedia of candlestick charts book, here are three to chew on. The pages refer to the book where the tips appear.

1. Above the stomach candles that appear within a third of the yearly low perform best -- page 92.
2. Above the stomach candles within a third of the yearly high frequently act as reversals -- page 95.
3. Above the stomach works best as part of a downward retracement in an upward price trend -- page 93.

Above The Stomach: Example

The above the stomach candlestick pattern appears on the daily scale and it is circled in red. The candle appears in a downward price trend with the first candle being black followed by a white one. The white candle has a body that is above the mid point of the body of the black candle, and this one acts as a temporary reversal of the downward price trend.

I write temporary reversal because when price rejoins the downward price trend, it cannot fight the current for long. The upward move falters and then price begins sliding, pulled down by a downward price trend already established. For this reason, that is why I recommend trading this candle as part of a downward retrace in an upward price trend. When price exits from the candle pattern, it rejoins the upward trend and off you go.

-- Thomas Bulkowski

See Also

• Bullish separating lines differ from above the stomach by price trend and a common opening price.
• If you prefer candlesticks, then visit over 100 of them in the alphabetical index.
• Click to view the visual candlestick index to make identification easier.
• Visit the visual chart pattern index to hunt for other chart patterns.
• The alphabetical chart pattern index covers more topics than the visual index.

If at first you don't succeed, call it version 1.0!