Bearish Abandoned Baby

A bearish abandoned baby is a rare three-candle top. A long up candle runs with the trend, then a doji gaps completely above it, sitting alone with clear air below, and the next candle gaps back down below the doji. The doji is the abandoned baby, isolated at the top with gaps on both sides. That stranded high marks the moment buyers ran out and sellers took the tape.

Steve Nison documents the abandoned baby in Japanese Candlestick Charting Techniques (1991), the rare strict form of the evening doji star with gaps either side.

How to spot it

• The market is rising into the pattern.
• The first candle is a long up (green) candle.
• The second candle is a doji whose entire range sits above the first candle’s high.
• The third candle is a down (red) candle whose entire range sits below the doji.
• Both gaps are clean, with no overlap on either side of the doji.

The dashed box on the chart above marks the 3 candles on a real occurrence, with the advance before and the move after.

The psychology

The long up candle is buyers in command, closing high and carrying the trend. The doji that gaps far above it looks like the rally going vertical: price leaps higher, and a euphoric crowd buys the open. But the doji opens and closes at nearly the same level. The buying that created the gap finds no one left to chase it, and for a whole session the side that owned the advance cannot lift price any further.

Then the next candle gaps clean below the doji, with empty air on both sides. The market reached up into the doji and now drops back under it without trading through the levels between. Buyers who paid up at the top got no continuation, sellers seized the gap lower, and the doji is stranded at the peak with no one willing to defend it. The wider and cleaner the gaps, the more complete that change of hands looks.

Whether that stranded high actually leads to a fall is the question the figures below take up.

Does it actually work?

A pattern is a setup, not a trade, so the honest question is not “did it win” but “how much room did it tend to offer before it was proven wrong.” The tabs below answer that across five futures markets (Nasdaq, S&P 500, gold, crude oil, natural gas) and seven timeframes from one minute to one day.

For each occurrence we measure the room the move offered in units of the pattern’s own risk, then set it against what a random entry on the same market would have done. When the pattern offers more room more often than chance, that shows up as a real edge. When it does not, the page says so plainly.

Read it with the sample size in view. On the faster timeframes a pattern can fire thousands of times, enough to trust. On the daily chart it is far rarer, so treat those numbers as a hint rather than a verdict. Thin samples are flagged for you on the page.

How we measured it

• Entry is the close of the final candle of the pattern.
• One unit of risk, 1R, is the distance from that close up to the pattern’s invalidation point: the highest high of the three candles that form it. If price trades through there, the setup is wrong.
• We then follow the next 20 bars and record how far price ran in your favor, in multiples of that risk, before the stop was hit.
• Every figure is set against a random entry on the same market and timeframe, so the market’s own drift is accounted for.
• No profit target and no position sizing. Where you take profit is a strategy choice; this measures only the room the pattern tends to give.

What this page does not cover

• Volume on the pattern’s candles.
• Whether the pattern forms at a meaningful resistance level.
• Pairing it with a trend filter or a confirming signal.
• A profit target or position sizing. We use the pattern’s own invalidation point as the stop to define risk, but where you take profit, and how much you put on, are strategy decisions this page leaves to you.