HOLLOW POINT TRADING
What is a Marubozu?
Marubozu is a Japanese word meaning "bald" or "shaved head." In candlestick charting, it refers to a candle with no shadows (wicks)—the open and close are at the extreme high and low of the session. This represents complete control by one side of the market from open to close.
When you see a Marubozu, it tells you that buyers or sellers dominated the entire session without any significant pushback from the opposing side.
Types of Marubozu
Bullish Marubozu (White/Green)
Structure: Opens at the low, closes at the high. No upper or lower shadows.
Meaning: Buyers controlled the entire session. Price only moved up from open to close with no selling pressure pushing it below the opening price.
Signal: Strong bullish sentiment. In a downtrend, can signal reversal. In an uptrend, confirms continuation.
Bearish Marubozu (Black/Red)
Structure: Opens at the high, closes at the low. No upper or lower shadows.
Meaning: Sellers controlled the entire session. Price only moved down with no buying pressure pushing it above the opening price.
Signal: Strong bearish sentiment. In an uptrend, can signal reversal. In a downtrend, confirms continuation.
Marubozu Variations
Opening Marubozu
Has no shadow on the opening side but may have a small shadow on the closing side. For a bullish opening Marubozu, open equals the low (no lower wick). Still very bullish but slightly less so than a full Marubozu.
Closing Marubozu
Has no shadow on the closing side but may have a small shadow on the opening side. For a bullish closing Marubozu, close equals the high (no upper wick). The close at the extreme shows strong conviction into the close.
Trading the Marubozu
Bullish Marubozu Signals
- After downtrend: Potential reversal—buyers taking control
- At support: Strong rejection, high-probability bounce
- During uptrend: Continuation confirmation, trend acceleration
- Breakout candle: Valid breakout confirmation with conviction
Bearish Marubozu Signals
- After uptrend: Potential reversal—sellers taking control
- At resistance: Strong rejection, high-probability decline
- During downtrend: Continuation confirmation, selling acceleration
- Breakdown candle: Valid breakdown with strong conviction
Trading Considerations
Entry Strategies
Aggressive: Enter at the close of the Marubozu or open of the next candle in the direction of the Marubozu.
Conservative: Wait for a pullback to the midpoint of the Marubozu body before entering.
Confirmation: Wait for the next candle to close in the same direction before entering.
Stop Loss Placement
Bullish Marubozu: Place stop below the low of the Marubozu candle
Bearish Marubozu: Place stop above the high of the Marubozu candle
Context Matters
Most powerful when: Forms at key support/resistance, after extended trends, with above-average volume, at significant chart pattern breakouts
Less reliable when: Forms in the middle of a range, during low-volume periods, against the larger trend
Key Takeaways
The Marubozu is one of the most powerful single-candle patterns because it shows complete dominance by one side of the market. No shadows mean no opposition. Look for Marubozus at key levels, after extended moves, and as breakout confirmation candles. The larger the Marubozu relative to recent candles, the more significant the signal.