Bullish Closing Marubozu Explained & Backtested (2024)

The bullish closing marubozu, also known as the white closing marubozu, is a one-bar bullish continuation Japanese candlestick pattern that historically leads to future bullish price action, according to decades-long backtesting.

If you’re trading this bullish candle using outdated technical methods, you’re leaving money on the table.

Keep reading if you want to understand how to trade the bullish closing marubozu optimally on your candlestick charts.

What Are Bullish Closing Marubozu Candlestick Patterns?

The bullish closing marubozu is a frequently occurring candlestick pattern.

The bullish marubozu gets its name from having little to no upper wick.

Trading lore suggests it leads to bullish action, and we’ll validate this shortly, but before we do, let’s learn how to identify this single Japanese candlestick pattern.

How to Identify the Bullish Closing Marubozu Candlestick Pattern

The following are the requirements for a valid bullish closing marubozu:

• A long white body.
• A close price very close to the high. (A tiny upper shadow)
• The bullish closing marubozu doesn’t require a trend.

All we need to do is find a long bullish candle with no or tiny upper wick. The prevailing trend doesn’t matter. The bullish closing marubozu appeared on the Apple (AAPL) daily chart on October 6th, 2021. 

And while the current trend doesn’t matter for identification, I decided to test the past performance of the bullish closing marubozu in both downtrends and uptrends.

Speaking of performance, let’s learn how to trade this single-candle formation.

How to Trade the Bullish Closing Marubozu Candlestick Pattern

History tells us that the bullish closing marubozu is most successful when traded as a bearish continuation in a downtrend and a bearish reversal in an uptrend. 

The data tells us that the direction is down, while conventional trading logic has this backward.

Let’s learn how to trade this pattern in the traditional matter, and then we’ll understand how data-driven, professional traders do it differently.

Bullish Closing Marubozu Bullish Continuation Trade Setup

Again, the bullish closing marubozu is one of the most straightforward patterns to identify. We see one long green bar with little to no lower wick on Google’s (GOOG) daily chart on November 12th, 2021.

Traders traditionally go short at a break of the bar’s low and set a stop loss above the candle high. We see that price does continue moving in the bullish direction leading to a potentially profitable trade depending upon your risk-reward ratio.

But as I mentioned, if you traded this pattern, you’re going against what history tells us works – you’re not acting like a data-driven trader.

So how would data-driven traders make money off of this pattern?

Bullish Closing Marubozu Bearish Reversal Trade Setup

We can see the bullish closing marubozu on the Netflix (NFLX) daily chart on July 26th, 2019.

A data-driven trader will enter short at the break of the close, setting a stop loss below the high of the closing marubozu signal. 

In the above example, we would enter expecting a longer-term bearish move the next day, turning a profit on the trade.

Does the Bullish Closing Marubozu Candlestick Pattern Work? (Backtest Results)

Using the following rules, I backtested the bullish closing marubozu candlestick patterns on the daily timeframe in the crypto, forex, and stock markets.

• A close above the 50-day SMA constitutes an uptrend.
• I tested risk-reward ranges from 1 to 5. 
• The optimal risk-reward ratio is selected using profit per bar.
• Entry and exits are discussed in the how-to trade section above.
• Confirmation must occur within three days of the pattern signal.

Similar Candlestick Patterns

Multiple candlestick patterns are often confused with the bullish closing marubozu.

Bearish Closing Marubozu vs. Bullish Closing Marubozu

The bearish closing marubozu is almost precisely the same as its bullish brother. The bearish pattern has a large black candle with little to no lower wick, while the bullish closing, as we just saw, is a large bullish candle with little to no upper wick.

Bullish Marubozu vs. Bullish Closing Marubozu

The bullish marubozu candlestick pattern is almost identical to the bullish closing marubozu. Each pattern has a single large real body, but the bullish marubozu requires little to no upper and lower wicks, while the bullish closing marubozu requires little to no lower shadow.

The Bottom Line

The bottom line is the bullish or white closing marubozu pattern frequently occurs due to being a single candlestick pattern. Most traditional trading wisdom states this pattern is bullish, but that goes against history.

The data shows that professional traders should bet bearishly with the bullish marubozu in all markets. If a data-driven approach excites you, check out the backtest results to learn how to trade all of the single candlestick patterns.