Red Marubozu

This candlestick represents extreme bearishness and is characterized by a long red body having no shadows on either end.

Recognition Criteria

1. The body of the candlestick is red and long.

2. There are no upper or lower shadows.

Candlestick Requirements and Flexibility

The red body of the candlestick should be longer relative to the other candlesticks on the chart. Shadows should not exist.

Trader’s Behavior

A Red Marubozu forms when the opening price is equal to the high of the day, and the closing price is equal to the low of the day. This shows that the sellers controlled the price action from the first trade to the last trade. The day opens and prices continue to move down all day without stopping, thus forming a long red day with no upper shadow. The day also closes at the low of the day with no lower shadow.

This candlestick is generally bearish. However, its position within the broader technical picture is also important. It may show a potential turning point and suggest that prices have reached a resistance level after an extended rally. If it is seen after a long decline, it may signal panic or capitulation, a final sell off attempt before bulls regain control. Still, the candlestick alone is not reliable enough to decide about the direction of the markets, since it reflects only one day’s trading.