Learning how to read and trade them adds a valuable weapon to your trading arsenal. Most technical analysis is based on Japanese candlestick charts, after all. In this post, we’ll go over everything you need to know to trade bearish kicking candle patterns.
To start, let’s define them.
What Is a Kicking Down Candlestick Pattern?
A kicking down (or “bearish kicking” or “bearish kicker”) is a bearish reversal formation. They occur during uptrends and consist of 1) a large-bodied marubozu candlestick moving up followed by 2) a large-bodied marubozu candlestick moving down that is preceded by a gap down.
It is the bearish version of the kicking pattern, and therefore the opposite of the kicking up pattern. It is also similar to the bearish separating lines pattern.
Of course, no candlestick pattern guarantees a particular outcome. They are more like suggestions than promises.
So, what do kicking down patterns really tell you?
What Bearish Kicking Patterns Mean
Unlike some patterns, English speakers do not use the Japanese name for this one.
In fact, it’s hard to determine where the terms “kicking” and “kicker” come from (or how they relate to the pattern). It’s an easy name to remember but it doesn’t provide any insight into how the pattern works.
In trading terms:
- First Period – The price increases significantly and closes at its high, in line with the upward trend.
- Pre/Post-Market Trading – The price decreases significantly, opening a gap below the first period.
- Second Period – The price decreases significantly and closes at its low.
This threatens the ongoing uptrend and creates several decision zones that are likely to play a major role in determining trend direction. If buyers cannot push price back above the formation, it may lead to a bearish reversal and subsequent downtrend.
Figuratively, kicking downs indicate that momentum has switched rapidly.
How To Recognize Bearish Kicker Candlestick Patterns
Patterns are attractive partly because they stand out.
To the untrained eye, they may mean nothing. But to those with experience, they are something like a beacon. They draw your attention to a specific segment of price action, encouraging you to look more closely.
To gain this insight, all you need to do is learn the rules and practice finding them on the charts.
By definition, a kicking down pattern has several requirements.
- It must appear during a general uptrend.
- The first candle must be a bullish marubozu candlestick.
- The first candle must not have any wicks.
- The second candle must be a bearish marubozu candlestick.
- The second candle must open with a gap down below the first candle’s body.
- The second candle must not have any wicks.
As you can see, each candle has its own unique ruleset.
However, some exceptions may be acceptable.
- Neither candle necessarily has to be a marubozu, as long as both are long-line candlesticks.
- The second candle doesn’t necessarily have to open with a gap, as long as it opens even with the first candle’s open (especially in markets where gaps are less common, like cryptocurrency).
You may find better results by stretching some of these criteria (or even adding your own). For instance, your analysis may reveal that bearish kicker patterns with marubozu candles perform more reliably than those with other candle types. Or, you may find the opposite.
Technically, these variations may fall more accurately under other candlestick reversal patterns, like the bearish separating lines.
This is okay though, as implication supersedes classification. And similar patterns usually have similar implications (though not always).
Yet, that does not mean that these standards are wholly irrelevant. In fact, certain ones are definitely mandatory, such as the direction of the candles in relation to trend. It just means that deeper examination may help you identify more and/or better trading opportunities.
Ultimately, how seriously you take each of these guidelines is up to you. Don’t forget that the purpose of analyzing candlestick patterns is to interpret underlying price action. Your pattern labeling skills are less important.
To this end, you need to understand where they fit.
Where Bearish Kickers Fit in the Chart Narrative
The markets are often described as a battle between the bulls and the bears.
Kicking down patterns show that the bulls pressed their advantage on candle one, lost the momentum between candles one and two, then surrendered to the bears completely by the end of candle two.
On the chart, it looks like a sudden change of fortunes.
The first day played out as expected, with a powerful move up. In post-market hours, devastating news broke that affected the fundamentals of the asset. From there, price plummeted all the way back below the open of the day before. This crash continued throughout the second day, leading to a dramatically lower close.
The stage is now set for a fight over the levels highlighted by this price action. If sellers can defend these levels, the chance of a bearish reversal increases.
Please note: This is only an illustration. Kicking down patterns can reflect any number of real-world scenarios.
In the short-term, it amounts to a surprise roundhouse kick from the bears.
The question for traders:
“Will we see the bulls fight back or is the reversal a forgone conclusion?”
To answer that question, you’ll need more than an understanding of Japanese candlesticks and candlestick patterns. You’ll want to evaluate both within the context of longer-term chart patterns as well as trend and price levels. You’ll also want to make use of your own chart markup and indicators.
Explore the history of your preferred asset(s) with respect to kicker candlestick patterns and apply your findings to your own trading style.
The more thorough your technical analysis, the more clear the story in the charts becomes.
How To Trade Kicking Down Candle Patterns
Bearish reversal patterns are great places to enter shorts or exit longs, especially when you see them coming.
As such, bearish kicking candle patterns serve as easy-to-spot signs of potential changes from bullish to bearish momentum. They may even lead to cycle-ending tops.
In most cases, you can assign greater weight to multi-stick patterns than single candles because they provide more information over a longer duration. However, you should wait for all candles to close before making any decisions. Otherwise, there is a good chance that you’ll get caught in a fake out.
Additionally, there are a few other things you should consider before trading candlestick patterns.
First and foremost, they are never a “sure thing.” According to Bulkowski’s Encyclopedia of Candlestick Patterns, kicking downs have a hit rate of 54% (while kicking ups have a hit rate of 53%). This is little better than a coin flip.
What’s more, candlestick patterns do not have uniform price targets or measured moves like chart patterns do. That makes position management trickier.
Plus, failed reversal patterns often lead to continuation or consolidation. Thus, you’d be wise to seek additional confirmation factors to increase your odds of a successful trade.
Some of these include:
- Volume – Reversals are often accompanied by elevated trading volume. For kicking patterns, you want to see a spike on the second candle (or shortly thereafter).
- Price Formations – Bearish reversal patterns that form just below important resistance levels tend to be more reliable. They also reinforce the strength of these levels.
- Oscillator Shift – Oscillating indicators like the RSI or stochastics are commonly used to identify reversals by analyzing slope, percentile, and/or divergence.
The more corroborating elements are present, the more confident you can be about the strength of a bearish kicking reversal signal.
Even so, it would be difficult to form a successful trading strategy built around any single candlestick pattern. There simply isn’t enough there to develop a strong edge. It would still be suboptimal with an expert understanding of trading math, order execution, market psychology, risk management, options, and automation.
In essence, kicker patterns are more useful idea givers than trade makers.
Better yet, you’ll probably find more success building your strategy around other tools and using candlestick patterns as the final point of confirmation.
Other Candlestick Pattern Types
There are many bearish reversal candlestick patterns.
The kicking down is only one.
Likewise, there are many bullish reversal candlestick patterns. Not to mention, you have bearish continuation candlestick patterns and bullish continuation candlestick patterns.
For most traders though, tackling all candlestick patterns at once may be the best learning path.
- Abandoned Baby – Bearish | Bullish
- Breakaway – Bearish | Bullish
- Counterattack Lines – Bearish | Bullish
- Doji Star – Evening | Morning
- Engulfing – Bearish | Bullish
- Harami – Bearish | Bullish
- Harami Cross – Bearish | Bullish
- In Neck – Bearish | Bullish
- Ladder – Top | Bottom
- Last Engulfing – Top | Bottom
- Mat Hold – Bearish | Bullish
- Matching – High | Low
- Meeting Lines – Bearish | Bullish
- On Neck – Bearish | Bullish
- Separating Lines – Bearish | Bullish
- Star – Evening | Morning
- Stomach – Below | Above
- Tasuki Gap – Downside | Upside
- Three Inside – Down | Up
- Three Methods – Falling | Rising
- Three Outside – Down | Up
- Three-Line Strike – Bearish | Bullish
- Tri-Star – Bearish | Bullish
- Tweezer – Top | Bottom
- Window – Falling | Rising
Sure, it is quite a long list.
Luckily for us all, you don’t need to memorize every pattern and its criteria. Instead, focus on price action and technical analysis principles. The goal is to be able to look at any group of candlesticks and understand what they mean.
The more candlestick patterns you study, the easier this will become.
Takeaways
To review:
Kicking downs are a type of candlestick pattern that signal a potential bearish reversal. While not a guarantee, their appearance may indicate that market conditions are shifting in favor of sellers. When used properly, this can help you find winning trades.
Of course, there are other candlestick patterns that you should learn about. Still, the ability to recognize patterns is not enough to trade successfully on its own.
Nonetheless, you’ve now added one more weapon to your trading arsenal.
Have questions or more information to add? Contribute to the conversation in the comments below! Or, if you know someone who could benefit from this post, share it with them. You can also check out our Candlestick Patterns Guide to improve your candlestick analysis skills.