Hikkake Pattern

DEFINITION of 'Hikkake Pattern'

A charting pattern used by technical traders which is used in identifying market direction. The Hikkake pattern is identified by its resembelance to an inside bar pattern, where the range of a new point or bar falls outside a previous point or bar. This breakout can be reflect both a bullish or bearish outlook, depending on the direction of the breakout (above or below a previous high or low).

BREAKING DOWN 'Hikkake Pattern'

From a Japanese word meaning "hook, catch, ensnare," it was first described by Daniel L. Chesler, CMT. When traders are committing capital to a market only to see it move away from what they expected, what is described in charts is a hikkake pattern, giving the impression the market has hooked or tricked traders into thinking the market was moving in a particular direction.

RELATED TERMS
  1. Sushi Roll

    A candlestick pattern consisting of 10 bars where the first five ...
  2. Bar Graph

    A chart that plots data with rectangular bars representing the ...
  3. Bullish Abandoned Baby

    A type of candlestick pattern that is used by traders to signal ...
  4. Evening Star

    A bearish candlestick pattern consisting of three candles that ...
  5. Morning Star

    A bullish candlestick pattern that consists of three candles ...
  6. Inside Days

    A charting term used by technical analysts and day traders. Inside ...
Related Articles
  1. Trading Strategies

    Trade Forex Through Inside Day Breakout Strategy

    Inside day breakout is a popular strategy for forex trading. Here's how to recognize the patterns, entry/exit points and trading scenarios.
  2. Forex Education

    Trading The Non-Farm Payroll Report

    Discover how to trade the NFP report without getting knocked out by the irrational volatility it can create.
  3. Technical Indicators

    Gauging Entry And Exit Signals With Range Bars

    Wide range price bars often generate important signals that traders can use for timely entry or exit.
  4. Charts & Patterns

    The 5 Most Powerful Candlestick Patterns (NUAN, GMCR)

    Statistics show unusual accuracy for the buy and sell signals of certain candlestick patterns like abandoned baby, evening star, and three black crows.
  5. Entrepreneurship

    Economics of Owning a Bar

    Understand what costs go into starting and running a bar, as well as what earnings can be expected. Learn whether or not it is smart to own a bar.
  6. Chart Advisor

    These ETFs are Breaking Out of Chart Patterns Now

    Three buys and one sell; here are four ETFs breaking out of chart patterns right now.
  7. Chart Advisor

    Breakout Stocks to Watch Right Now

    These three stocks are near major breakout points, which will affect the short-term, and potentially the long-term direction of the stocks.
  8. Trading Strategies

    Technical Analysis: Chart Patterns

    By Cory Janssen, Chad Langager and Casey MurphyA chart pattern is a distinct formation on a stock chart that creates a trading signal, or a sign of future price movements. Chartists use these ...
  9. Active Trading

    Tales From The Trenches: Volume Confirmed Broadening Pattern

    Find out how to make sense of this tricky - but profitable - formation.
  10. Trading Systems & Software

    How To Spot And Screen For Chart Patterns With Finviz: Manually Filter The Results

    Whether the quick summary list is used, or a comprehensive stock screen conducted for chart patterns, some manual work is still required. The chart pattern screener narrows down the list of available ...
RELATED FAQS
  1. What are the differences between a bar chart and candle sticks?

    Explore the difference between bar and candlestick charts. Learn how technical analysts use charts in the analysis of supply ... Read Answer >>
  2. What is a common price target when identifying a double bottom?

    Learn how to identify a double bottom stock pattern and where to set a target selling price point to get the most out of ... Read Answer >>
  3. What are the main opportunities that arise when a stock exhibits a continuation pattern?

    Learn about continuation patterns and the opportunities they can present. Use these trading strategies to profit from these ... Read Answer >>
  4. How do I build a profitable strategy when spotting a Triple Bottom pattern?

    Learn about the triple bottom chart pattern and how to create a profitable trade strategy based on this pattern, including ... Read Answer >>
  5. How do I implement a forex strategy when spotting a Rounding Bottom Pattern?

    Understand the key factors to implementing a profitable forex trading strategy based on recognizing the formation of a rounding ... Read Answer >>
  6. How do I build a profitable strategy when spotting a Symmetrical Triangle pattern?

    Understand the basics of the symmetrical triangle chart pattern including formation and how to use this pattern to create ... Read Answer >>
Hot Definitions
  1. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  2. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  3. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  4. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  5. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  6. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
Trading Center