The harami that's settled before the opening bell
The gap-up harami is the candlestick setup you'll meet most often, and it's decided at the very first print of the day. With the gap it averaged +1.07% over the next five days on SPY since 2005 and QQQ since 2011. Without it, 0.13%.
This is the one I'd show anybody who has ever sold on a bad first morning.
On Thursday, October 29th, 2020, QQQ printed a gap-up harami. The very next day it fell more than 2.5%, which is exactly the kind of day that makes people bail. By the fifth close after the signal, QQQ was 6.51% higher.
That was the third-best harami of the years we measured. Across all of them, a harami after a down week that opened with a gap up finished higher five trading days later 69.2% of the time on SPY since 2005 and QQQ since 2011.
Two candles, and one number at the open
A harami is two candles. The first is a solid red day, the kind that makes the evening news sound very sure about where things are heading. The second finishes green and keeps its open and its close inside the red day's body, like a small candle tucked inside a big one.
The condition is the gap. The second day has to open above the red day's close by more than a sliver, which means the orders that piled up overnight were mostly buyers. The sellers had their big day, and the next morning the buyers didn't wait for the opening bell to say so.
It's the part of this setup I like best, because it's settled at the very first print of the day, by orders people placed while the market was closed. And it makes a big difference: with the gap, the harami averaged +1.07% over the next five days in those years, and without it, the same two candles averaged just 0.13%.
A recent one
QQQ printed one on Monday, September 8th, 2025. It had spent the first week of September drifting, down less than a fifth of a percent over five sessions, which still counts as a down week. Friday was a solid red day, and Monday opened 0.4% above Friday's close and finished green inside Friday's body.
Five sessions later QQQ was 2.21% higher, almost exactly what a typical winner made.
This is also the setup you'll run into most often of the three, so it's the one most worth knowing on sight.
The exact rule, and the shortcut
The free guide has the exact rule: how big the red day's body has to be, how far the open has to clear its close, and how to check all of it from a free chart's price table in a minute or two.
Send me the free guide: Highest Performing Candlestick Patterns
Or let the scanner measure the gap for you. Every evening after the close it checks the slide, the two candles and the opening gap on the 100 largest US stocks and on SPY, QQQ and IWM.
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James H
Your Friendly Neighborhood Trading Nerd
