Downside Tasuki Gap is a three-candle pattern found in a downtrend that usually hints at the continuation of the downtrend. The first candle is long and red, followed by a smaller red candle with its opening price that gaps below the body of the previous candle. The third candle is green and it closes inside the gap created by the first two candles, unable to close it fully. The bull’s inability to close that gap hints that the downtrend might continue.
The bullish version of the Downside Tasuki Gap pattern is the Upside Tasuki Gap candlestick pattern.
Traditionally, this candlestick pattern is recognized in conjunction with a specific trend direction, i.e. it might be important for the pattern if the price has been generally going up or down. The ‘Detect Trend Based On’ option allows you to specify which of the following methods to use to detect the trend:
By comparing two different SMAs, the 'SMA50, SMA200' option only detects stronger trends. When the trend is weak and the condition above is not met, no patterns will be detected. In contrast, the 'SMA50' option will also detect weaker trends.