How to Trade Double Bar High Lower Close (DBHLC) Patterns
In Naked Forex trading, chart patterns provide clean and effective setups without the need for indicators. One of the most reliable price action patterns is the Double Bar High Lower Close (DBHLC). This pattern offers a high-probability reversal signal—especially when it forms at key resistance levels.
In this guide, you’ll learn what the DBHLC pattern is, how to identify it, and how to trade it with confidence using the Naked Forex method.
What Is the DBHLC Pattern?
DBHLC stands for Double Bar High Lower Close. It’s a two-candle bearish reversal pattern that forms after an uptrend or at resistance.
Pattern Requirements:
- Two consecutive candles with similar highs
- The second candle closes lower than the first
- Both candles typically have small bodies, with the second showing bearish control
This structure suggests bulls failed to break higher and bears took over, making it a signal to consider short trades.
Where Does DBHLC Work Best?
The DBHLC is most powerful when:
- It forms at key resistance or supply zones
- Appears after an extended move up
- Occurs on higher timeframes like H4 or Daily
These conditions increase the probability of a meaningful reversal.
How to Trade the DBHLC Pattern: Step-by-Step
1. Identify the Pattern
Look for:
- Two bars with nearly equal highs
- The second bar closing lower than the first
- Preferably occurring after a strong bullish run
Mark the highs of both candles and draw a resistance line.
2. Confirm with Context
Ensure the pattern appears near:
- Previous highs
- Supply zones
- Psychological round numbers
Price action context boosts reliability.
3. Set Entry, Stop Loss & Target
- Entry: Place a sell stop just below the low of the second candle
- Stop-loss: Just above the high of the pattern
- Take-profit: Use 1:2 or 1:3 risk-reward, or aim for the next support zone
4. Trade Management Tips
- Avoid trading DBHLC patterns in choppy or sideways markets
- Wait for a clean close of the second bar
- Combine with confluence factors like trendlines, Fibonacci, or zones
Example Chart (Visual Tip)
If you’re using TradingView or MT4:
- Mark previous resistance zone
- Identify DBHLC pattern
- Set pending order with proper SL/TP
- Watch how price respects the reversal zone
This visual habit will help train your eye to spot DBHLC patterns in live markets.
Common Mistakes to Avoid
- Entering too early before the second candle closes
- Ignoring the location (always trade DBHLC at key resistance)
- Trading in low-volume sessions where the pattern may lack strength
Conclusion
The DBHLC pattern is a reliable bearish reversal signal in the Naked Forex toolbox. When combined with smart trade management and price context, it can deliver high-probability entries without the need for indicators.
As always, practice identifying and backtesting the pattern before applying it live.
FAQs
Q1: What is the opposite of DBHLC?
The bullish version is the Double Bar Low Higher Close (DBLHC) pattern, used to spot long setups.
Q2: Can DBHLC be used on lower timeframes?
Yes, but it’s more effective on higher timeframes like H4 or Daily due to cleaner structure.
Q3: Does DBHLC always signal a trend reversal?
Not always. It can also mark a short-term pullback. Use it with market context for best results.
Q4: Is DBHLC a standalone strategy?
It can be, but it works best when combined with resistance zones, trendlines, or price patterns.
Q5: How often does the DBHLC pattern appear?
It appears fairly often in trending markets, especially after extended bullish runs.
