✤ Setup Conditions
1. 1st candle’s close must be greater than 1st candle’s open, it means 1st candle is a bullish candle.
2. 2nd candle’s close must be less than 2nd candle’s open, it means 2nd candle is a bearish candle.
3. 2nd candle’s close must be less than 50% of the 1st candle’s entire range.
4. 2nd candle’s high must be greater than 1st candle's high, it means 2nd candle has a higher high.
5. 2nd candle’s open must be higher than 1st candle's high.
6. 3rd candle confirmation needed.
The Dark Cloud Cover is a bearish candlestick pattern that signals a potential reversal from an uptrend to a downtrend. It also consists of two candles:
1. First Candle
☛ A large bullish candlestick (green/ white) indicating strong buying pressure.
2. Second Candle
☛ A bearish candlestick (red/black) that opens above the high of the first candle but closes below its midpoint.
✤ Key Characteristics
☛ The second candle "Covers" more than 50% of the first candle's body, like a dark cloud overshadowing bullish momentum.
☛ Indicates a shift from bullish to bearish sentiment.
✤ Interpretation
☛ Suggests that the bears have taken control, potentially leading to a downward trend.
☛ Works best when it forms near a resistance level or after a prolonged uptrend.
✤ Confirmation
☛ Traders wait for the next candle to close lower to confirm the bearish reversal.
