📈 This ‘Bearish’ Pattern Made Us Bullish (Here’s Why)

Author

Quantified Strategies
June 24, 2025

Sponsored by

📈 3 Bullish Candlestick Patterns That Actually Work

Hey there,

Most trading patterns sound good in theory — but very few hold up when you run the numbers.

We don’t like guessing. So we tested 3 well-known bullish candlestick patterns on the S&P 500 (SPY). Real backtests. Real trades. No fluff.

A quick snapshot:
✅ Bearish Engulfing (yes, “bearish” — but the data disagrees): 71% win rate, 5% annual return.
✅ Three Outside Down: 78% win rate, consistent edge.
✅ Bullish Harami: 76% win rate, steady performance.

One simple rule: Buy when the pattern forms, exit when today’s close breaks yesterday’s high.

No predictions — just probabilities.

Full pattern explanations with complete trading rules + Tradestation & Amibroker code are on our website if you want to test them yourself.

🤫 The Bearish Engulfing Pattern Is Not So Bearish

You’ve probably heard: bearish engulfing means time to sell.

We checked. It’s not true — at least not for the S&P 500.

Back to 1993, buying when a bearish engulfing appears and exiting on a close above the prior day’s high has produced nearly 300 trades with a clear positive edge.

Why? Simple: Mean reversion beats textbook definitions.

Most traders trade what sounds good.
The best traders trade what’s proven.

🎓 No Secrets, No Hype

If you want the full list of 75 tested candlestick patterns — with clear rules and plug-and-play code — it’s all on our site.

Trade facts, not opinions.

Stay sharp,
Quantified Strategies

Looking for unbiased, fact-based news? Join 1440 today.

Join over 4 million Americans who start their day with 1440 – your daily digest for unbiased, fact-centric news. From politics to sports, we cover it all by analyzing over 100 sources. Our concise, 5-minute read lands in your inbox each morning at no cost. Experience news without the noise; let 1440 help you make up your own mind. Sign up now and invite your friends and family to be part of the informed.