Abandoned Baby Pattern
Overview
The abandoned baby is a rare three-candle reversal pattern considered one of the most reliable candlestick signals. It forms when a doji gaps away from the preceding candle and the following candle gaps in the opposite direction, leaving the doji isolated with gaps on both sides. The pattern indicates a dramatic shift in market sentiment where momentum completely reverses between sessions.
Key Concepts
A gap must exist on both sides of the central doji candle, separating it from the candles before and after. The bullish version appears at the bottom of a downtrend with a gap-down doji followed by a gap-up bullish candle. The bearish version appears at the top of an uptrend with a gap-up doji followed by a gap-down bearish candle. This pattern is extremely rare in twenty-four-hour crypto markets because gaps require a session close. Volume typically spikes on the third candle as new participants enter.
Entry Signals
Enter on the close of the third candle confirming the reversal direction. Gap confirmation on both sides of the doji is mandatory. Look for the pattern at major support or resistance levels for added confluence. Volume should noticeably increase on the confirmation candle.
Exit Signals
Stop beyond the doji's extreme wick on the trend side. Target a measured move equal to the height of the prior trend leg. Exit if the gap between the doji and the third candle fills completely. Partial profit at the nearest significant structure level.
Best Timeframes
Daily, Weekly
Pro Tips
Because crypto markets trade continuously, the abandoned baby is more commonly found in traditional equity and commodity markets with session gaps. In crypto, look for near-gap equivalents during low-liquidity periods. When this pattern does appear, its rarity makes it a very high-conviction signal.
More Topics in This Category
Engulfing Patterns
A bullish engulfing pattern occurs when a large green candle completely engulfs the prior red candle near the bottom of a trend. A bearish engulfing is the opposite — a large red candle swallows the prior green candle at the top. Engulfing patterns are among the most reliable two-candle reversal signals.
Pin Bar Setups
Pin bars are single-candle reversal patterns with a long tail (shadow) on one side and a small body on the opposite side. The tail shows a sharp rejection of a price level. Pin bars are the most widely used price action signal among naked chart traders and work on all markets and timeframes.
Morning & Evening Star
The morning star is a three-candle bullish reversal: a large bearish candle, a small body candle (the star) that gaps down, and a large bullish candle that closes well into the first candle's body. The evening star is the bearish mirror. These are among the strongest candlestick reversal patterns.
Piercing Line & Dark Cloud Cover
The piercing line is a two-candle bullish reversal pattern where a down candle is followed by an up candle that opens below the prior low and closes above the midpoint of the prior body. The dark cloud cover is its bearish counterpart — an up candle followed by a down candle that opens above the prior high and closes below the midpoint. Both patterns signal a potential shift in sentiment when they appear at key support or resistance levels.