Candlestick Patterns Guide

Description: A single candle with a small body at the top and a long lower shadow (at least 2x the body). Minimal or no upper shadow. Forms at the bottom of a downtrend.

Psychology: Sellers pushed price down, but buyers stepped in and pushed it back up, closing near the high. Shows rejection of lower prices.

Confirmation: Bullish candle following the hammer that closes above the hammer's high.

Reliability: ★★★★☆ High when confirmed

Description: A small bearish candle followed by a larger bullish candle that completely engulfs the previous candle's body. Forms at the bottom of a downtrend.

Psychology: Bears are in control, but bulls overwhelm them, completely reversing the previous day's move and closing higher.

Confirmation: Next candle continues higher, closing above the engulfing candle.

Reliability: ★★★★★ Very high

Description: A large bearish candle, followed by a small-bodied candle (gap down), then a large bullish candle that closes well into the first candle's body.

Psychology: Strong selling, indecision (doji/small candle), then strong buying pressure returns.

Confirmation: Bullish candle following that maintains upward momentum.

Reliability: ★★★★★ Very high

Description: A bearish candle followed by a bullish candle that opens below the previous low and closes above the midpoint of the first candle.

Psychology: Selling pressure continues initially, but buyers push price up significantly, closing above 50% of the previous candle.

Confirmation: Next candle continues upward movement.

Reliability: ★★★★☆ High

Description: A single candle with a small body at the bottom and a long upper shadow (at least 2x the body). Minimal or no lower shadow. Forms at the top of an uptrend.

Psychology: Buyers pushed price up, but sellers stepped in and pushed it back down, closing near the low. Shows rejection of higher prices.

Confirmation: Bearish candle following that closes below the shooting star's low.

Reliability: ★★★★☆ High when confirmed

Description: A small bullish candle followed by a larger bearish candle that completely engulfs the previous candle's body. Forms at the top of an uptrend.

Psychology: Bulls are in control, but bears overwhelm them, completely reversing the previous day's move and closing lower.

Confirmation: Next candle continues lower, closing below the engulfing candle.

Reliability: ★★★★★ Very high

Description: A large bullish candle, followed by a small-bodied candle (gap up), then a large bearish candle that closes well into the first candle's body.

Psychology: Strong buying, indecision (doji/small candle), then strong selling pressure returns.

Confirmation: Bearish candle following that maintains downward momentum.

Reliability: ★★★★★ Very high

Description: A bullish candle followed by a bearish candle that opens above the previous high and closes below the midpoint of the first candle.

Psychology: Buying pressure continues initially, but sellers push price down significantly, closing below 50% of the previous candle.

Confirmation: Next candle continues downward movement.

Reliability: ★★★★☆ High

Description: A long bullish candle, followed by 3 small bearish candles that stay within the first candle's range, then another long bullish candle.

Psychology: Brief consolidation/pullback within an uptrend before the trend continues.

Confirmation: Fifth candle breaks above the first candle's high.

Reliability: ★★★★☆ High

Description: A long bearish candle, followed by 3 small bullish candles that stay within the first candle's range, then another long bearish candle.

Psychology: Brief consolidation/bounce within a downtrend before the trend continues.

Confirmation: Fifth candle breaks below the first candle's low.

Reliability: ★★★★☆ High

Description: A candle where the open and close are nearly the same, creating a very small or non-existent body. Can have varying shadow lengths.

Psychology: Perfect balance between buyers and sellers. Neither side is in control, signaling potential reversal or continuation based on context.

Confirmation: Next candle's direction indicates the likely outcome.

Reliability: ★★★☆☆ Depends on context

Description: A candle with a small body (can be bullish or bearish) and long upper and lower shadows of similar length.

Psychology: Buyers and sellers are both active but neither can gain control. Indicates indecision and potential trend change.

Confirmation: Look at trend context and following candles.

Reliability: ★★★☆☆ Depends on context