Click to learn more. Confirmation Confirmation is a subsequent signal that validates a position stance. Traders and investors sometimes look for more than one signal or require validation before acting. For an indicator such as MACD, confirmation of a divergence may be a subsequent moving average crossover.
Many candlesticks also require confirmation.
Hammers, bullish engulfing and piercing patterns all require a subsequent advance to confirm the reversal. Conversely, shooting stars, bearish engulfing and dark cloud cover patterns require a subsequent decline to confirm the reversal.