Category: 2. Candlestick Patterns 1 to 10

What is the Inverted Hammer candlestick pattern? As far as the inverted hammer pattern is concerned it should be understood that it is a strong early indication of a possible upcoming price change. It is not necessarily a signal to purchase. The inverted Hammer candlestick pattern is similar to the shooting star formation. The important characteristics define the pattern.…

What is the Shooting Star candlestick pattern? A shooting star candlestick pattern is a chart formation. It occurs when the price of an asset is significantly pushed up, but then rejected and closed near the open price. This makes a long upper wick, a small lower wick and a small body. The upper wick must take up…

What is an Abandoned Baby candlestick pattern? An abandoned baby is a startling sight in the real world; it is a very rare reversal signal. At times, the abandoned baby will be a bear (cub), and other times it will be a bull (calf). Either way, it indicates the possible reversal of a current trend. Luckily,…

What is the Three Black Crows candlestick pattern? What is it made of? Three black crows show a bearish candlestick pattern that predicts the reversal of an uptrend. Candlestick charts indicate the opening, high, low, and the closing price on a security. For stocks going higher, the candlestick is green or white. When moving lower, they show a black…

What is the Engulfing pattern? Traders make use of the engulfing pattern to enter the market while hoping for a possible trend reversal. Candles in this pattern signal a reversal in the current trend. It involves two candlesticks with one candle entirely “engulfing” the body of the other. To get a valid engulfing pattern, the…

What is the Dark Cloud Cover candlestick pattern? Definition The dark cloud cover is a bearish top reversal or trend reversal pattern. It is present in an uptrend and indicates a potential weak uptrend. It is a two-candlestick pattern and looks like the piercing pattern. Since it is a bearish trend reversal pattern, the dark cloud…

What is the Evening Star pattern? An evening star candlestick pattern is a stock-price chart pattern. Technical analysts use it to detect when a trend is about to reverse. It is a bearish candlestick pattern and it consists of three candles: The first part of the evening star pattern is a large bullish green candle. The bulls are…

What is the Harami candlestick pattern? Even though the word Harami appears in the Hindi language that is not what the context of this article refers to. The Harami which is applicable here is an old Japanese word which means pregnant or conception. With this image in mind, it will be easier to grasp the candlestick…

Traders often look for signs of indecision in the market where selling pressure goes down and leaves the market flat. This is where Doji candles can be seen as the market opens and closes at the same level or very close to the same level. The indecision makes way for a bullish move because the…