Inside Day = the entire price range for a period is contained within the previous period’s range.

(Referring to days as the time period, but the principle is universal.)

- So, 2 days when the price range hasn’t shifted implies indecision in the market.
If at the end of a pronounced trend, that trend would appear to be complete…

A special case of the Inside Day is the Harami cross – the second candlestick is a doji contained within the body of the first period’s candlestick

One useful technique is if an inside day appears at the end of a significant trend, a strengthened signal is obtained if the pattern is close to an identified level of support/resistance.

But indecision in the market is always at the mercy of news events – all the fancy tech analysis isn’t going to help there…

One Response to “Inside Day and Harami Crosses”

1. Inside Day and Harami Crosses says:

   October 30, 2008 at 10:54 am

   So, 2 days when the price range hasn’t shifted implies indecision in the market. If at the end of a pronounced trend, that trend would appear to be complete… [...]

   Reply