Key Reversal

A bearish key reversal occurs when a market makes a new high for the move, but closes below the close of the prior bar. It results in some type of candlestick reversal pattern: shooting star, bearish engulfing or piercing line.

A bullish key reversal occurs when a market makes a new low for the move, but closes above the close of the prior bar. It usually results in a candlestick reversal pattern: hammer, bullish engulfing or piercing line.