The Key Reversal pattern is just as the name implies, a reversal formation.
The Key Reversal involves two candlesticks. The first stick is normal-sized and can be any color. The second candle drives to a new extreme and then reverses into a large-bodied candle.
The second candle is key to indicating whether the pattern is bullish or bearish. If the second candle is green, then it is a bullish Key Reversal, and additional gains are expected. If the second candle is red, then look for the market to correct lower.
If the Key Reversal appears near support or resistance levels, then the signal tends to be stronger.
1December 19, 2025 2.4K 2 3
