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35 Powerful Candlesticks Patterns are essential for understanding the stock market and making informed trading decisions. Explore 35 key patterns in this downloadable PDF guide.


Introduction to the World of 35 Powerful Candlesticks Patterns

35 Powerful Candlesticks Patterns Candlestick patterns serve as the graphical representation of price actions over a defined period. Each candlestick in these patterns provides four important price points within that duration: the opening, closing, highest, and lowest prices. The central part, known as the body, shows the gap between the opening and closing prices. Similarly, the lines extending from the body, commonly referred to as lights or shades, signify the total price range during the period. These patterns are more than just shapes; they are the storytellers of the market, telling the story of buyer and seller dynamics in a language understood by traders worldwide.

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There are main three candlestick patterns.


  • Bullish Candlestick Patterns
  • Bearish Candlestick Patterns
  • Neutral Candlestick Patterns


35 powerful candlestick patterns PDF download


Bullish Candlestick Patterns

Bullish candlestick patterns on charts signal possible market gains, guiding traders about likely price increases. These patterns are key for spotting early trends in rising market movements.


Bullish Single Candlestick Patterns: Indicators of Potential Reversals:


Hammer

This pattern features a short body with an extended lower wick. It usually appears toward the conclusion of a downtrend, indicating a likely bullish comeback.

Inverted Hammer

Similar to the Hammer but with a long upper wick and a small body, this pattern suggests a bullish reversal may be on the horizon, particularly following a period of a downward trend.

Black Marubozu

Similar to its long black body and absence of wicks, this pattern typically signals strong bearish control. However, in certain contexts, it can also predict a potential shift to bullish momentum.

White Marubozu

This pattern, marked by a long white body without any shadows, is often a clear indicator of bullish power in the market.


Bullish Double Candle Patterns: Key Indicators of Trend Shifts:


Bullish Engulfing

This two-candle shaping begins with a smaller bearish candle, quickly overshadowed by a larger bullish candle that completely covers the first. This pattern often signals a potential shift in trend, pointing towards an upward movement.


Bullish Piercing Pattern

This pattern starts with a bearish candle and is followed by a larger bullish candle. The bullish candle opens below the low of the previous day and closes more than halfway into the body of the bearish candle, suggesting a positive turnaround.


Bullish Counterattack

It begins with a bearish candle, which is then fully covered by an even larger bullish candle. This pattern suggests a strong bullish response and potential trend reversal.


Tweezer Bottom

Identified after a downtrend, this Tweezer bottom pattern consists of two successive bearish candles with matching or extremely similar lows. It indicates potential support and hints at an approaching bullish reversal.


Mat Hold

A more complex pattern, the Mat Hold, indicates bullish trend continuation. It starts with a bullish candle, followed by a bearish one, then a long bullish candle. A smaller candle, which can be bullish or bearish, before the final bullish candle that confirms the trend's ongoing.


Bullish Triple Candlestick Patterns: Strong Indicators of Market Reversals:


Morning Star Pattern

This three-candle formation starts with a bearish candle, followed by a smaller, uncertain candle (commonly a doji), and runs with a bullish candle. This sequence often signals a shift towards a bullish reversal.


Three White Soldiers

Comprising three very long bullish candles, each closing higher than the last, this pattern suggests a significant upward movement, reflecting strong bullish momentum.


Rising Three Methods

A five-candle bullish continuation pattern. It begins with a long bullish candle, followed by three smaller, bearish candles, and concludes with another long bullish candle, supporting the continued positive trend.


Upside Tasuki Gap

This pattern involves a bullish candle, a gap up, followed by a bearish candle, and ends with another bullish candle that opens within the range of the bearish one. It indicates a potential bullish continuation, especially after the gap.


Three Inside Up Pattern

Starting with a large bearish candle in a downtrend, this pattern includes a smaller bullish candle within the first candle's range, followed by another bullish candle closing above the mid-point of the initial bearish candle. It suggests a shift from bearish to a bullish attitude.


Three Outside Up

A three-candle pattern in a downtrend signals a possible bullish reversal. It starts with a bearish candle, followed by a larger bullish candle that engulfs the first, and a third bullish candle that opens within the range of the engulfing candle and closes higher, confirming the bullish trend change.


Bearish Candlestick Patterns

Bearish candlestick patterns act as visual alerts on price charts, often indicating a potential downward momentum or trend. These patterns serve as a "red light" for traders, suggesting that the stock's price is likely to go down. Smart traders monitor these patterns closely to strategically time their market entries, Capitalizing on the predicted price reduction. These patterns are important for finding selling possibilities and for those looking to short-sell, as they often phase shifts from bullish to bearish market sentiments.


Single Candle Patterns:


Hanging Man

This pattern, which is like a figure hanging, is a single candlestick indicator. It often seems later an uptrend and signals a potential shift to a bearish trend.

Shooting Star

Characterized by a small body and a long upper wick, the Shooting Star is a single candlestick pattern that suggests a bearish reversal might be near.

Black Marubozu

A distinct pattern marked by a long black body without any wicks, the Black Marubozu is a clear sign of strong bearish sentiment and market control.


Double Candle Patterns:


Evening Star Pattern

This three-candle formation frequently suggests a bearish turn. It starts with a bullish candle, followed by a small, often uncertain candle, and concludes with a bearish candle.

Bearish Engulfing

In this two-candle pattern, a small bullish candle is followed by a larger bearish candle that fully covers the first one, showing a possible shift to a downward trend.

Dark Cloud Cover

Starting with a bullish candle, this two-candle pattern features a subsequent bearish candle that opens above the previous day’s high and closes more than halfway into the bullish candle, indicating a bearish takeover.

Bearish Harami

This pattern comprises a large bullish candle followed by a smaller bearish candle fully contained within the range of the bullish candle, hinting at a potential bearish reversal.

Bearish Counterattack

It begins with a bullish candle, which is then completely surpassed by another bigger bearish candle, suggesting a bearish response and potential trend change.

On-Neck Pattern

This pattern features a long black body on the first day and a small-bodied candle on the second day that closes just above the previous day's low, often signaling a bearish ongoing.

Tweezer Top

This pattern appears after a rise and is defined by two following bullish candles with comparable peaks. It indicates potential resistance and hints at an upcoming bearish reversal, signaling a shift in market sentiment.

Falling Window

Identified by a gap where the second candle opens lower than the first candle's low, the Falling Window suggests a continued downward trend, marked by a strong bearish sentiment.


Triple Candle Patterns:


Three Black Crows

This pattern is a sequence of three long bearish candles, each closing lower than the previous one. It's a strong indicator of a potential consistent downward movement.

Three Inside Down

This bearish reversal pattern starts with a bullish candle, followed by a smaller bearish candle within its range, and concludes with a larger bearish candle, indicating a potential trend reversal.

Three Outside Down

Beginning with a bullish candle, this pattern progresses with a larger bearish candle covering the first, and ends with another bearish candle, indicating a strong bearish turn.

Downside Tasuki Gap

A bearish repetition pattern in candlestick charting. It features two bearish candles creating a gap down, followed by a bullish candle that opens within the second candle's body but does not close the gap, suggesting the downtrend's likely repetition.


Neutral Candlestick Pattern


Neutral candlestick patterns are similar to a yellow traffic light in the world of market analysis. They don't highly positive a bullish or bearish trend, instead indicating concern, and reflecting uncertainty or uncertainty in market direction. Traders usually analyze these patterns to evaluate the market's stability or to predict possible shifts in trends. These patterns serve as critical tools for identifying periods of Stability or hesitation in the market, offering insights into moments where the market is balancing between buyers and sellers without clear control from either side.

Single Candle Patterns:


Doji

This pattern, inspired by its tiny body, stock market uncertainty. It represents a delicate balance between buying and selling forces, often hinting at a possible trend reversal, which could be bullish or bearish.

Spinning Top

Characterized by a small body surrounded by long upper and lower wicks, the Spinning Top indicates a state of uncertainty in the market, suggesting that a trend reversal is possible.

High Wave

Known for its long wicks extending well beyond a small body, this pattern signals significant market instability and uncertainty, highlighting the intense a battle between buyers and sellers without a clear victor.


Three Candle Patterns:


Falling Three Methods

Typically a bearish pattern, the Falling Three Methods can take on a neutral tone when it includes smaller, uncertain candles. It starts with a long bearish candle, followed by three smaller candles — possibly dojis or spinning tops — that are contained within the range of the initial candle. The pattern concludes with a bearish candle similar in size to the first. This configuration often suggests a period of reorganization, indicating a pause in the downtrend rather than its strong continuation.


Conclusion

35 Powerful Candlesticks Patterns is your gateway to understanding market dynamics and improving your trading strategies. Master these patterns to make informed decisions and enhance your trading success. Happy trading!


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