Candlestick patterns are some of the most powerful trading techniques you can use in our trading. Candlestick patterns can help you find bullish and bearish trades, and they can also help you manage your open trades. In this post, we go through 35 powerful candlestick patterns you can start using in your trading today. Note: You can get your 35 powerful candlestick patterns PDF and cheat sheet below. FREE PDF GUIDE: Get Your 35 Powerful Candlestick Patterns PDF Guide Here. Japanese candlestick patterns are price action formations you can use to predict where the future price may go.

They are called candlestick patterns because they are formed on candlestick charts and form a repeatable pattern. Technical analysis and pattern traders look to these patterns because they believe they can show the times when the bulls or bears are in control. This can lead to high probability trades.

There are both bullish and bearish candlestick patterns , and in this post, we go through both types and how you can use them. Most traders use candlestick patterns as entry signals. You can, however, also use them to manage your open trades, including using them for take-profit targets and stop-loss points. One thing that is often overlooked by retail traders when trading candlestick patterns is where they form and in what context is critical.

To find the best trades using these patterns, you will want to look at things like whether the market is trending or ranging or if there are critical levels of support and resistance.

If you are after the best results, you will want to use other information to help you find the best trades and not use candlesticks alone. An example of this would be using popular indicators such as moving averages or the MACD. Using other indicators and price action analysis will help you confirm high-probability trades and increase your chance of winning trades. Here is your complete list of 35 powerful candlestick patterns you can start using in your trading now. You can also get the free PDF of the 35 powerful candlestick patterns below.

The hammer pattern is a single candlestick formation that signals a potential reversal back higher. The example below shows a bullish hammer pattern in play. We can see that price opened and sold off heavily; however, by the end of the session, the bulls had roared back and taken over, signaling they were looking to price back higher. The bullish engulfing bar is a high probability pattern that hints that a reversal back lower is about to take place. For a valid bullish engulfing bar, there needs to be a lower low and higher high than the previous candlestick.

This indicates that the bulls have taken complete control, and the price could be looking to make a new move higher. The first candlestick of this pattern is a significant bearish candlestick with little to no wicks. The second candlestick then gaps lower than the previous candle, but the buyers come in, and the candle finishes above the mid-way point of the first candle.

This is a bullish reversal candlestick pattern , and it should form after a move lower. The final candlestick is a significant bullish candlestick showing the buyers have now taken control after the indecision of the doji candlestick. This pattern is formed when we see three consecutive bullish candlesticks that have little to no wick and open within the body of the previous candlestick.

The second candlestick is a small bullish candlestick that is entirely formed inside the first candlestick. The last candlestick confirms the bullish reversal by moving and closing above the first candlestick. Traders using this pattern will typically take a long position after it has confirmed itself, with the last candlestick closing higher. The white Marubozu pattern is a single candlestick pattern that hints at a bullish reverse back higher.

The bullish harami pattern is another multiple candlestick pattern that hints at a reversal higher. The first candlestick of the harami pattern is a large bearish candlestick with a large body and little to no wicks on either end. The second candlestick is a small bullish candlestick that forms entirely within the previous candlestick. This pattern should not be traded alone but with other market information such as the trend and critical support and resistance levels.

To identify this pattern, we need to see that the opening and closing prices are close to each other and that there is a large wick that points higher. The tweezer bottom candlestick pattern is a bullish reversal candlestick that forms at the bottom of a move lower. These two candlestick patterns show the bulls looking to take control and push the price back higher.

The low of these candlesticks will be almost the same, showing that both candlesticks found support. The three outside up is another bullish candlestick pattern that hints at a reversal back higher. The second candlestick in this pattern is a large bullish candle, and the third is another long bullish candle that confirms that the buyers have taken control. The bullish counterattack pattern is a two candlestick pattern that indicates a potential bullish reversal. The EURUSD monthly candle of January was not only heavily bearish, but it was also a massive candle: more than 1, pip from high to low.

This has been by far the largest bearish candle since the downtrend started in May When analyzing the weekly chart, the EURUSD showed bullish candlestick patterns for the first time a 7 week period.

It is called a Harami candlestick and the pattern indicates a potential bullish reversal. This could set the tone for a bullish EURUSD this upcoming week. When I place a Fibonacci tool on the Harami weekly candle then the The path of the highest probability for the EURUSD, therefore, seems to be a bullish zigzag followed by a downtrend continuation.

This analysis is highly dependent on the NFP figures. The other majors are showing a different situation. The GBPUSD bearishness seems substantially less interesting to me due to various reasons:. The USDJPY bullishness was certainly not visible on the USDJPY during January.

Its candle closed bearish and indicates a decent to high chance of further consolidation. I am expecting the triangle to continue before any bullish or bearish break occurs. Contrary to the EURUSD and GBPUSD, the AUDUSD not only had very big bearish candlestick patterns in the January candle but also has a bearish weekly candle the previous week. There was no crucial bounce for the AUDUSD and hence I am expecting a more bearish trend. Technically speaking I am looking for more downside continuation upon the retracement of the monthly candle orange Fib.

Looking at a weekly USDJPY chart, you will notice that we have embedded weekly Master Candles set up. For those of you unfamiliar with Master Candles, they are candles that engulf the next four following candles. Trading a break of a Master Candle on any time frame can be very profitable, but trading a break of a weekly Master Candle can be especially profitable. Usually, when I trade hourly master candles, I place my stop on the opposite side of the master candle.

If the candle is too wide to maintain my risk parameters, I will place my stop in the center of the master candle. Since this master candle was around pips wide, I planned to trade the break as if it were a break of a lower time frame candle and try to set my risk around 50 pips.

That way I will be able to trade the break with decent size and hopefully get a piece of the initial move. In this example, the price action was about 25 pips above the low of the inner master candle which is near I placed a pending sell order at From there, I followed my stops down using the hourly chart, placing my stop at the top of the prior hourly bar. The Spike and Ledge pattern by Linda Raschke is the best candlestick pattern for cryptocurrencies. Every crypto trader should know this pattern especially if you want to keep up with the volatility in the cryptocurrency market.

The OHL trades are the best candlestick patterns for penny stocks. This trading pattern allows everyone to establish a position during the first 5 minutes of the trading day. The best candlestick patterns for binary options are the pin bars, bearish and bullish outside bars, the 3 white soldiers, and the 3 black crows.

For binary options trading, candlestick patterns are the most reliable techniques you can use to place your bets on. The best candlestick pattern to profit in any market and across different time frames is the Hot Dog pattern. This is a unique pattern taught to our subscribers that can be used to detect bullish and bearish reversals as well as continuations in any market. The best candlestick pattern to buy stocks is the 3-bar strategy.

This candlestick pattern is an all-in-one trading strategy is a trend-dependent strategy that can ride both bullish markets and bearish markets. The best candlestick PDF guide is a result of a series of research that leads us to find tradable market tendencies The price of any market follows some mechanical laws that can be observed through candlestick chart patterns.

Having some definable rules of entry based on candlestick patterns can really help the aspiring trader. Some of the best candlestick patterns are more predictable once you have a framework developed around these chart patterns. As a trader, your obligations are to apply these trading concepts inside your own understanding of the market. Be sure to read about our shooting star candle guide!

Please Share this Trading Strategy Below and keep it for your own personal use! Thanks, Traders! We specialize in teaching traders of all skill levels how to trade stocks, options, forex, cryptocurrencies, commodities, and more. Our mission is to address the lack of good information for market traders and to simplify trading education by giving readers a detailed plan with step-by-step rules to follow. Here you go. This step-by-step guide will show you an easy way to trade with the MACD indicator.

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DEBASHIS says:. May 25, at pm. kamacho says:. January 28, at pm. Jan du Plessis says:. November 17, at am. TradingStrategyGuides says:. February 12, at am. As for a candlestick chart, it has a body and shadows or what are also called wicks.

Bodies are defined as the range between the opening and closing price. Shadows represent the range of the day outside of the opening and closing of the prices. As you can see in the example below, there are bar charts on the left and candlesticks on the right. It shows how the price moved during a specific period of time using colors and how far the price moved during that period.

Time frames are shown for the time frame you are using or have selected. For example, if you are using a 5-minute time frame, a candle will show the HIGH, LOW, OPEN, and CLOSING in 5 minute intervals. The intra-session high represents bulls, and the intra-session low represents the bears. If the close is closer to high, then the bulls are in control. If the close is closer to the low, then the bears are in control. A bullish candle shows that the price has increased over the set time period.

For the bearish candle, it shows that the price has decreased over the time period. Each fully formed candle represents the price action of a specific time period.

Candlesticks have two parts, a real body and a wick tail. The open and close prices are the first and last transaction prices of that time frame. If no real body was shown, or the real body is tiny, then it means that the open and close are almost the same. Also, real bodies have color but differ in every charting platform. The most common color of real bodies is green, red, white, and black.

However, you can change this to your liking. A green or white candle means the price finished higher or the closing price is above the open price.

A red or black candle means that the price has decreased over the time period, or the top of the real body is the open price, and below is the closing price. The bullish candle and the bearish candle similarly reflect the difference between the open and close price during that period. Most charting platforms allow you to make adjustments to your candlesticks to be visually appealing and easily identifiable.

Quite a name for a candlestick. This pattern consists of two candles and shows when the price of a security moves beyond the high and low of the previous sessions range. This candle is your signal for a sustained upward move or trend change back higher. A Doji candlestick is one of the most popular candlestick patterns. The Doji pattern usually has a very small body with a close near the open price. It also has a long wick formed to the high and low.

Candlestick patterns are some of the most powerful trading techniques you can use in our trading. Candlestick patterns can help you find bullish and bearish trades, and they can also help you manage your open trades.

In this post, we go through 35 powerful candlestick patterns you can start using in your trading today. Note: You can get your 35 powerful candlestick patterns PDF and cheat sheet below. FREE PDF GUIDE: Get Your 35 Powerful Candlestick Patterns PDF Guide Here. Japanese candlestick patterns are price action formations you can use to predict where the future price may go.

They are called candlestick patterns because they are formed on candlestick charts and form a repeatable pattern. Technical analysis and pattern traders look to these patterns because they believe they can show the times when the bulls or bears are in control. This can lead to high probability trades.

There are both bullish and bearish candlestick patterns , and in this post, we go through both types and how you can use them. Most traders use candlestick patterns as entry signals. You can, however, also use them to manage your open trades, including using them for take-profit targets and stop-loss points. One thing that is often overlooked by retail traders when trading candlestick patterns is where they form and in what context is critical. To find the best trades using these patterns, you will want to look at things like whether the market is trending or ranging or if there are critical levels of support and resistance.

If you are after the best results, you will want to use other information to help you find the best trades and not use candlesticks alone. An example of this would be using popular indicators such as moving averages or the MACD. Using other indicators and price action analysis will help you confirm high-probability trades and increase your chance of winning trades. Here is your complete list of 35 powerful candlestick patterns you can start using in your trading now. You can also get the free PDF of the 35 powerful candlestick patterns below.

The hammer pattern is a single candlestick formation that signals a potential reversal back higher. The example below shows a bullish hammer pattern in play. We can see that price opened and sold off heavily; however, by the end of the session, the bulls had roared back and taken over, signaling they were looking to price back higher.

The bullish engulfing bar is a high probability pattern that hints that a reversal back lower is about to take place. For a valid bullish engulfing bar, there needs to be a lower low and higher high than the previous candlestick. This indicates that the bulls have taken complete control, and the price could be looking to make a new move higher.

The first candlestick of this pattern is a significant bearish candlestick with little to no wicks. The second candlestick then gaps lower than the previous candle, but the buyers come in, and the candle finishes above the mid-way point of the first candle.

This is a bullish reversal candlestick pattern , and it should form after a move lower. The final candlestick is a significant bullish candlestick showing the buyers have now taken control after the indecision of the doji candlestick. This pattern is formed when we see three consecutive bullish candlesticks that have little to no wick and open within the body of the previous candlestick. The second candlestick is a small bullish candlestick that is entirely formed inside the first candlestick.

The last candlestick confirms the bullish reversal by moving and closing above the first candlestick. Traders using this pattern will typically take a long position after it has confirmed itself, with the last candlestick closing higher.

The white Marubozu pattern is a single candlestick pattern that hints at a bullish reverse back higher. The bullish harami pattern is another multiple candlestick pattern that hints at a reversal higher.

The first candlestick of the harami pattern is a large bearish candlestick with a large body and little to no wicks on either end. The second candlestick is a small bullish candlestick that forms entirely within the previous candlestick. This pattern should not be traded alone but with other market information such as the trend and critical support and resistance levels.

To identify this pattern, we need to see that the opening and closing prices are close to each other and that there is a large wick that points higher. The tweezer bottom candlestick pattern is a bullish reversal candlestick that forms at the bottom of a move lower. These two candlestick patterns show the bulls looking to take control and push the price back higher. The low of these candlesticks will be almost the same, showing that both candlesticks found support.

The three outside up is another bullish candlestick pattern that hints at a reversal back higher. The second candlestick in this pattern is a large bullish candle, and the third is another long bullish candle that confirms that the buyers have taken control.

The bullish counterattack pattern is a two candlestick pattern that indicates a potential bullish reversal. This pattern will form after a move lower, and you can use it to try and ride the subsequent move back higher.

This pattern shows that the bulls have moved into the market and are looking to push prices back higher. The second candle is a small bullish candle that gaps below the first candle and then closes close to where the first candle closed.

This forms a horizontal neckline pattern. The dark cloud cover is a bearish reversal pattern that forms after the price has been moving higher. This is a multiple candlestick pattern that shows the price may be moving from being bullish to bearish. The first candlestick is a significant bullish candlestick which shows the price continuing on with the trend higher. Traders will typically enter a short trade at the completion of this pattern and when the new candlestick opens.

To identify a valid bearish engulfing bar pattern, we need to see a higher high and lower low than the previous candlesticks. We also want to see that the price has closed towards the bottom of the candlestick showing the sellers were in control when the candlestick finished forming. To identify the three black crows pattern, we want to see three consecutive bearish candlesticks with little or no candlestick wicks. This is a single candlestick pattern that indicates there could be a bearish reversal about to take place.

This pattern forms with one sizeable bearish candle with little to no wicks on either end of the candlestick. The black Marubozu pattern shows that the sellers stepped in and controlled the selling for most of the session. The evening start pattern is another bearish reversal pattern that indicates a move higher could be coming to an end, and a new move lower is about to start.

The first candlestick is a bullish candle. The second is a doji that shows indecision in the market. The third is then a bearish candlestick. The three inside down pattern is a multiple candlestick pattern that hints at a bearish reversal. This pattern typically forms after a move higher, and traders will generally enter a trade using this pattern to ride a move lower.

The first candle of this pattern is a long bullish pattern. The second is a small bearish candle, and the third is a large bearish candlestick confirming that patten. Traders will typically enter a short trade once this pattern has been confirmed and the new candle opens. The shooting star is a bearish reversal signal hinting that the price may be about to move back lower. The body of this pattern needs to form towards the lower of the candlestick, and we need to see a sizeable upper candlestick wick.

This pattern is a bearish reversal pattern that hints that the bullish move higher could be coming to a close. The first candlestick of this pattern is a large bullish candle, and the second is a small bearish candle that forms within the previous candles open and close. Traders will typically enter a short trade when this pattern has been confirmed, and the new candle opens. The tweezer top pattern is the inverse pattern of the tweezer bottom and indicates a potential reversal lower.

This pattern typically forms after a move higher, and traders will often use it to enter new short trades. This pattern is formed with two candlesticks. The first candlestick is bullish, and the second is a bearish candlestick. The key to this pattern is that both candlesticks have almost the same high. This shows resistance was found, and with the second candlestick, the bears took over and pushed the price lower.

This is a bearish reversal pattern and hints that the price could soon be looking to sell off and move lower. The second candle of this pattern then gaps higher but ends up closing lower and near the first candles closing price. The Doji is formed after the bulls and the bears have fought for where the price is to go, but the price ends up closing near the middle of the candlestick.

With this pattern, you will see higher and lower candlestick wicks with a small candlestick body. The three outside down pattern is a bearish reversal pattern usually found after a strong move higher. The first candle is a short bullish candle. The second is a large bearish candle that fully engulfs the previous candlestick. The third candle is another bearish candlestick that closes below the second candle. Traders will typically enter a short trade when this pattern has been confirmed, and a new candle opens.

These candlestick patterns have upper and lower wicks, but the spinning top pattern has a slightly larger candlestick body. The falling three methods pattern is a continuation pattern that signals a continuation of the trend lower could be in place. This is a five candlestick pattern that shows there was a pause or disruption in the trend lower, but it could be about to continue. This pattern is created with two large candlesticks in the same direction of the trend.

There are then three smaller bullish candles in the middle. This pattern shows that the bulls tried to push prices higher, but they could not gather enough steam to create a reversal back higher. The high wave pattern shows that the current price is indecisive and that neither the bulls nor the bears are in control. This shows that both the bulls and the bears had periods of control during the session, but in the end, neither was in control.

The rising three methods have two large bullish candlesticks and three small bearish candlesticks in the middle. This shows that the bears tried to gain control and force a reversal lower but could not gather enough momentum to beat the trend higher.

The downside Tasuki gap pattern is a bearish continuation pattern that shows the trend lower could be looking to continue.

This pattern shows that the bulls tried to push prices higher, but they could not gather enough steam to create a reversal back higher. For binary options trading, candlestick patterns are the most reliable techniques you can use to place your bets on. This pattern is formed with three candlesticks and indicates a continuation of the trend higher could be on the cards. Table of Contents. Lathyn says:. Pip Hunter I hunt pips each day in the charts with price action technical analysis and indicators.

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