Known in Japanese as iki chigai sen, which means “lines that move in opposite directions,” the Bearish Separating Lines pattern is a tale of two candlesticks. Although they share the same starting point, they veer off in opposing directions. The first, which is white or green, soars upward from the starting point. The second, which is black or red, plummets. To learn more about this simple but scarce continuation pattern, review the information and advice we’ve compiled below.

Bearish Separating Lines Pattern

Formation

The Bearish Separating Lines pattern encompasses just two candles. To spot it, look for the following criteria:

First, the pattern must begin with a clear and defined downtrend. Second, a long bullish candle (white or green) must appear. Third, the next day must be defined by a long bearish candle (black or red), which will open at the same place as the first day opened. Ideally, the second candle will not have an upper wick.

That’s all there is to it! If you notice these three simple specifications, you have a Bullish Separating Lines pattern on your hands. In addition, you may spot a similar pattern with the opposite formation: an uptrend followed by a long black candle and a long white candle that open at the same place. This is the Bullish Separating Lines pattern.

Meaning

The bears are in the driver’s seat, establishing a strong downtrend until the bulls take the wheel. Although the price rises significantly during the bulls’ time in control, this period of ascendance is soon curbed by the bears. They seize control again on the second day, which opens at the same price that the previous day opened. Then, under the bears’ influence, the price drops again. This downtrend should be expected to continue.

Although this signal begins with a climbing price on day one, the subsequent descent echoes the downtrend that preceded the pattern. Between the close of the first day and the open of the second, there is a major leap down in price. The second day contains another downward leap. When you combine these two drops, it is easy to see why the downtrend is expected to continue. The strength of the bears is apparent, and a small setback won’t stand in their way. The longer the two candles are, the more reliable the Bearish Separating Lines pattern is.

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The Bearish Separating Lines pattern doesn’t appear very often, but when it does, pay attention! Despite its simplicity, it is reliable and noteworthy. However, before you make any moves based on the signal’s presence, check for confirmation. Look for a black candle, a gap down, or a lower close. Good luck!

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