The Abandoned Baby is a three-candle reversal pattern that forms with a gap on both sides of a Doji candle, signalling a sharp shift in market sentiment.
Bullish Abandoned Baby – Reversal from Downtrend
A strong bearish candle is followed by a gap-down Doji, and then a strong bullish candle that gaps up. This signals a potential shift from selling pressure to buying momentum.
Bearish Abandoned Baby – Reversal from Uptrend A strong bullish candle is followed by a gap-up Doji, and then a strong bearish candle that gaps down. This indicates a possible reversal toward selling pressure.
Why Is It Important?
The Abandoned Baby is considered a rare but powerful reversal pattern because the double gap reflects a sudden and decisive change in market sentiment.
Confirmation & Volume
Traders usually wait for follow-through price movement in the direction of the reversal. Higher trading volume during the third candle strengthens the reliability of the pattern.