Candlestick patterns II Doji ll Hammer ll Shooting star ll Engulfing ll Three white soldiers ll Three black crows

Candlestick patterns are a popular technical analysis tool used by traders to analyze market trends and make trading decisions. This method of analysis originated in Japan in the 18th century, and was used to analyze the price movements of rice. Today, candlestick patterns are used to analyze the price movements of all financial instruments, including stocks, currencies, and commodities.👇

Candlestick charts display the price movement of a financial instrument over a certain time period, usually ranging from minutes to months. Each candlestick represents the price movement during a specific period of time, with the candlestick body showing the opening and closing price, and the wicks or shadows showing the highest and lowest price during that period. Candlestick patterns are formed when a group of candlesticks display a specific pattern, which can indicate a potential change in market sentiment and direction.

Here are some of the most common candlestick patterns used in technical analysis:

Doji: A doji is a candlestick pattern that forms when the opening and closing price are very close to each other. This pattern indicates indecision in the market and can signal a potential trend reversal.


Hammer: A hammer is a bullish reversal pattern that forms when the price opens near the low of the day and then rallies, closing near the high of the day. This pattern indicates a potential change in market sentiment from bearish to bullish.

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Shooting star: A shooting star is a bearish reversal pattern that forms when the price opens near the high of the day and then falls, closing near the low of the day. This pattern indicates a potential change in market sentiment from bullish to bearish.


Engulfing: An engulfing pattern is a reversal pattern that forms when a small candlestick is followed by a larger candlestick that completely engulfs the previous candlestick. A bullish engulfing pattern occurs when a small bearish candlestick is followed by a larger bullish candlestick, indicating a potential trend reversal from bearish to bullish. A bearish engulfing pattern occurs when a small bullish candlestick is followed by a larger bearish candlestick, indicating a potential trend reversal from bullish to bearish.


Three white soldiers: The three white soldiers pattern is a bullish reversal pattern that forms when three consecutive long bullish candlesticks appear. This pattern indicates a potential change in market sentiment from bearish to bullish.


Three black crows: The three black crows pattern is a bearish reversal pattern that forms when three consecutive long bearish candlesticks appear. This pattern indicates a potential change in market sentiment from bullish to bearish.

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Candlestick patterns are not foolproof, and traders should always use them in combination with other technical and fundamental analysis tools to make trading decisions. It is also important to remember that the stock market is unpredictable, and any investment decision should be made based on careful analysis and consultation with experts.

In conclusion, candlestick patterns are a valuable tool for traders to analyze market trends and make trading decisions. By identifying these patterns and understanding what they signify, traders can make more informed decisions and potentially profit from market movements.