The Bullish Hikkake pattern is typically considered a continuation pattern, though it can sometimes signal a reversal depending on its context within the trend. It occurs after a false breakout from an inside bar. It reflects a temporary trap for traders who expect a breakout in one direction, only to see the price reverse and move in the opposite direction. The pattern forms when an inside bar is followed by a breakout to the downside (appearing bearish), but the price quickly reverses and breaks above the high of the inside bar within a few candles.

In an uptrend, the Bullish Hikkake often signals a brief consolidation or pullback before the trend continues upward. The failure of the initial bearish breakout traps short sellers, and the subsequent bullish move confirms strength in buying pressure. This is why it's generally viewed as a continuation pattern.

However, if found near the end of a downtrend or after an exhaustion move, it can act as a reversal signal, especially when supported by other indicators or volume spikes. Traders often look for confirmation with a close above the high of the inside bar and increasing momentum to validate the pattern’s bullish intent.

The Bullish Hikkake is primarily a short-term continuation pattern, though it can sometimes signal a reversal. It forms when price gets "trapped" in a false breakout—initially breaking below a consolidation (bearish trap) before reversing upward, resuming the prior uptrend. Traders watch for:

A small inside bar (indicating indecision).

A false breakdown below support .

A strong reversal candle confirms the trap.

While it often continues the existing trend, in downtrends, a Bullish Hikkake near key support may mark a reversal. Confirmation (e.g., volume surge, breakout above the pattern’s high) is crucial. Risk management (stop-loss below the trap’s low) is essential due to its deceptive nature.

The Bullish Hikkake is primarily viewed as a continuation pattern rather than a reversal setup. It begins with a “false” breakout to the downside: price briefly closes below a recent support area before quickly reversing back into the prior trading range. Traders then look for the price to move above the high of the “inside” or consolidation bar, confirming the false breakdown and signalling a continuation of the prevailing uptrend. Although the initial false break feels like a reversal, the pattern’s real power lies in highlighting trapped sellers and renewed buying pressure. As such, it works best when used to join an existing uptrend, helping traders add momentum‑driven entries with defined exits if the price fails to follow through.