Candlestick charts explained
Posted in Bullish reversals
The inverted hammer is a single candle pattern that appears at the bottom of a downtrend. There is a long upper shadow, which should be at least twice the length of the real body. The longer the upper shadow, the higher the potential of a reversal occurring. The color of the…
Posted in Bullish reversals
The bullish unique three river bottom is a bullish reversal three-line pattern. It forms in a down trend and starts with a long black candlestick on the first day that often closes at a new low. The second day is also black; a smaller candle with a long lower shadow…
Posted in Continuation patterns
Black spinning top is a single candlestick pattern with low reliability. Occasionally it behaves like a continuation pattern, other times it signals a trend reversal. This pattern has a small black body and long lower and upper shadows. The market moves higher and then sharply lower. The opening and closing…
Posted in Bearish reversals
The shooting star candlestick formation is regarded as a bearish reversal pattern that typically forms at the top of an uptrend. Preceding candlesticks must be white and should have a relative large real body. The second candlestick is the star with a short black or white body that gaps away…
Posted in Bullish reversals
The hammer is a common trading signal, made up of a single candlestick. It has a small body with a long lower shadow. The shadow is at least twice as long as the candlestick itself. There is very little or no upper shadow at all. The body may be black…
Posted in Bearish reversals
Hanging man is the name of a bearish trend reversal pattern, which forms at the top of an uptrend. The Japanese gave this name because it looks like a head with the feet dangling down. It is a single candlestick pattern that has a long lower shadow and a small…
Posted in Bearish reversals, and Bullish reversals
The white spinning top candlestick pattern has a single candle. The body of the candlestick is white and very small. The upper and lower shadows are longer than the body. In this pattern, the opening and closing stock prices are near each other. This pattern forms when there’s indecision among the…