Dark Cloud Cover
In technical analysis, Dark Cloud Cover is a candlestick pattern that indicates a momentum shift from bullish to bearish in an asset’s price.
Dark Cloud Cover patterns are composed of three candles that go as follows:
They initially start off as bullish, with a large up candle indicating a significant amount of buying.
The following candle gaps-up, taking the price even higher, but then sellers bring the price back down, causing this second candle to drop further than the half-way point of the previous one.
Finally, the third candle, also known as the confirmation candle, sees the price falling below the level of the second one.