Japanese candlestick - Frying pan bottom

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Frying pan bottom



Definition: A frying pan bottom structure is comprised of several Japanese candlesticks. The first candlesticks are bullish or bearish with small bodies. This series of candlesticks should form a rounded bottom. Then, a last candlestick is formed with a bullish gap opening. This is the opposite of a Dumpling top.

Illustration:

Frying pan bottom
Characteristic: A frying pan bottom often forms after a significant drop characterized by several large red Japanese candlesticks.

Significance: A frying pan bottom structure is a reversal pattern, it indicates a reversal in the bullish trend. This reflects a gradual exhaustion of sellers before buyers forcefully regain control.

Note: A frying pan bottom is a major pattern in Japanese candlesticks. It is a powerful structure. However, it is essential not to anticipate its formation and to wait for the bullish gap.

Invalidation
: If the bullish gap is filled on the last candlestick, the frying pan bottom structure is invalidated.

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