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Candlestick Patterns Strategies

The document outlines various candlestick patterns used in trading, including Bullish and Bearish Engulfing, Hammer, Shooting Star, Doji, Morning Star, Evening Star, Piercing Line, Dark Cloud Cover, Harami, Three White Soldiers, and Three Black Crows. Each pattern indicates potential market reversals or trends, providing traders with signals for decision-making. Understanding these patterns can enhance trading strategies and improve market predictions.

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22 views2 pages

Candlestick Patterns Strategies

The document outlines various candlestick patterns used in trading, including Bullish and Bearish Engulfing, Hammer, Shooting Star, Doji, Morning Star, Evening Star, Piercing Line, Dark Cloud Cover, Harami, Three White Soldiers, and Three Black Crows. Each pattern indicates potential market reversals or trends, providing traders with signals for decision-making. Understanding these patterns can enhance trading strategies and improve market predictions.

Uploaded by

kannankannankunnaa24
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Candlestick Patterns & Trading Strategies

Bullish Engulfing

A small red candle followed by a large green candle that completely engulfs the red. Indicates a

potential reversal to the upside.

Bearish Engulfing

A small green candle followed by a large red candle that completely engulfs the green. Indicates a

potential reversal to the downside.

Hammer

A candle with a small body and a long lower wick. Found at the bottom of a downtrend, signaling a

possible bullish reversal.

Shooting Star

A candle with a small body and a long upper wick. Found at the top of an uptrend, signaling a

possible bearish reversal.

Doji

The open and close prices are nearly equal. Indicates market indecision and a possible reversal

when confirmed by other candles.

Morning Star

A three-candle pattern: a large red candle, a small-bodied candle (gap down), and a large green

candle. Suggests a bullish reversal.

Evening Star

A three-candle pattern: a large green candle, a small-bodied candle (gap up), and a large red

candle. Suggests a bearish reversal.

Piercing Line
A long red candle followed by a long green candle that opens lower but closes above the midpoint of

the red. Bullish sign.

Dark Cloud Cover

A long green candle followed by a red candle that opens above the green but closes below its

midpoint. Bearish sign.

Harami

A small candle that fits within the body of the previous candle. Can be bullish or bearish depending

on trend and color.

Three White Soldiers

Three consecutive long green candles with small or no wicks. Strong bullish reversal signal.

Three Black Crows

Three consecutive long red candles with small or no wicks. Strong bearish reversal signal.

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