50 Accurate Candlestick Patterns (Top List & Examples)

Candlestick patterns are specific chart formations used in technical analysis to interpret price action and identify trading opportunities in the candlestick chart. Originating from Japanese rice traders, these patterns consist of individual or multiple candles, each showing the open, high, low, and close prices within a given trading period. Traders rely on these visual signals to forecast market sentiment, anticipate price movements, and effectively position themselves in trades.

Patterns are classified as bullish or bearish, depending on the type of signal they provide. Bullish patterns indicate that buying pressure may strengthen, whereas bearish patterns suggest increasing selling pressure and price declines. Understanding candlestick patterns allows traders to accurately forecast future price movements, enhance their decision-making processes, and improve trading performance.

This Candlestick Pattern Top List will show you the most powerful 50 Candlestick Formations in detail with examples and how to trade them, explained for beginners:

1. Hammer

The hammer is a bullish reversal pattern that appears at the bottom of a downtrend. It indicates that sellers initially drove the price lower, but strong buying pressure later pushed it back up, closing near the opening price. 

A hammer has a small real body near the top of the candle and a long lower wick that is at least twice the size of the body. The upper wick is either very small or nonexistent.

This pattern signals a potential trend reversal, but confirmation is required. Traders look for the next candle to close above the hammer’s high to validate the reversal. The hammer pattern is more reliable when it forms after a prolonged downtrend at key support levels and when accompanied by higher trading volume.

Section	Details
Construction	First Candle: A bearish candle preceding the hammer, often large-bodied. Second Candle: A bullish confirmation candle that closes above the hammer’s high.
Forecast	A bullish reversal is likely if confirmed by a strong green candle closing above the hammer’s high.
Type of Pattern	Single-candle bullish reversal pattern.
Trend Prior to the Pattern	Forms after a downtrend, signaling a possible upward reversal.
Opposite Pattern	Inverted Hammer
Stop-Loss Placement	Below the low of the hammer’s wick to allow for price fluctuations while maintaining a favorable risk-to-reward ratio.
Candlestick Success Rate In Accuracity:	55 – 72%

How Set Up a Trade with The Hammer Candlestick Pattern:

1. Identify a hammer pattern at the bottom of a downtrend.
2. Wait for confirmation with the next candle closing above the hammer’s high.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss below the hammer’s wick for protection.
5. Set a take-profit target based on the next resistance level.

2. Shooting Star

The shooting star is a bearish reversal pattern that appears at the top of an uptrend. It signals that buyers attempted to push the price higher, but strong selling pressure drove it back down, resulting in a close near the opening price. 

The candle has a small real body at the lower end of the range and a long upper wick at least twice the size of the body, with little to no lower wick. This pattern suggests that bullish momentum is weakening, and a potential reversal to the downside may occur. 

However, confirmation is needed with the next candle closing below the low of the shooting star. Its reliability increases when it forms at key resistance levels and with high trading volume.

Section	Details
Construction	First Candle: A bullish candle preceding the shooting star, often large-bodied. Second Candle: A bearish confirmation candle that closes below the shooting star’s low.
Forecast	A bearish reversal is likely if confirmed by a strong red candle closing below the shooting star’s low.
Type of Pattern	Single-candle bearish reversal pattern.
Trend Prior to the Pattern	Forms after an uptrend, signaling a possible downward reversal.
Opposite Pattern	Inverted Hammer
Stop-Loss Placement	Above the high of the shooting star’s wick to allow for price fluctuations while maintaining a favorable risk-to-reward ratio.
Candlestick Success Rate In Accuracity:	54 – 71%

How Set Up a Trade with The Shooting Star Candlestick Pattern:

1. Identify a shooting star pattern at the top of an uptrend.
2. Wait for confirmation with the next candle closing below the shooting star’s low.
3. Enter a sell trade at the close of the confirmation candle.
4. Place a stop-loss above the shooting star’s wick for protection.
5. Set a take-profit target based on the next support level.

3. Bullish Engulfing

The engulfing pattern is a two-candle bullish reversal formation that appears at the bottom of a downtrend. It consists of a small bearish candle followed by a larger bullish candle that completely engulfs the previous candle’s body. This signals a shift in momentum, as buyers have overwhelmed sellers, pushing the price higher.

To find strong confirmation, look for the next candle to close above the bullish engulfing candle’s high. This pattern is most effective when it forms at key support levels after a prolonged downtrend and when there is high trading volume.

Section	Details
Construction	First Candle: A small bearish candle forming in a downtrend. Second Candle: A larger bullish candle that engulfs the first candle’s real body.
Forecast	A bullish reversal is likely if confirmed by a strong green candle closing above the bullish engulfing pattern.
Type of Pattern	Two-candle bullish reversal pattern.
Trend Prior to the Pattern	Forms after a downtrend, signaling a possible upward reversal.
Opposite Pattern	Bearish Engulfing
Stop-Loss Placement	Below the low of the bullish engulfing candle to minimize risk.
Candlestick Success Rate In Accuracity:	71%

How Set Up a Trade with The Engulfing Candlestick Pattern:

1. Identify a bullish engulfing pattern at the bottom of a downtrend.
2. Wait for confirmation with the next candle closing above the bullish engulfing candle’s high.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss below the low of the bullish engulfing candle.
5. Set a take-profit target based on the next resistance level.

4. Morning Star

The morning star is a three-candle bullish reversal pattern that appears at the bottom of a downtrend. It consists of a large bearish candle, followed by a small-bodied candle (which can be bullish, bearish, or a doji), and finally, a strong bullish candle that closes well above the midpoint of the first candle. This formation signals that selling pressure has weakened, and buyers are beginning to regain control.

Traders consider the morning star a strong reversal pattern when it forms at key support levels or after an extended downtrend. Higher volume on the third candle strengthens its reliability. Confirmation comes when the next candle continues upward, closing above the third candle’s high.

Section	Details
Construction	First Candle: A large bearish candle continuing the existing downtrend. Second Candle: A small-bodied candle that represents indecision (can be bullish, bearish, or a doji). Third Candle: A strong bullish candle closing above the midpoint of the first candle.
Forecast	A bullish reversal is likely if confirmed by a strong green candle continuing higher.
Type of Pattern	Three-candle bullish reversal pattern.
Trend Prior to the Pattern	Appears at the bottom of a downtrend, indicating a potential upward reversal.
Opposite Pattern	Evening Star
Stop-Loss Placement	Below the low of the second candle (indecision candle) to allow for price fluctuations while protecting risk.
Candlestick Success Rate In Accuracity:	52-75%

How Set Up a Trade with The Morning Star Candlestick Pattern:

1. Identify a morning star pattern at the bottom of a downtrend.
2. Wait for confirmation with the next candle closing above the morning star’s high.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss below the lowest point of the pattern (second or first candle).
5. Set a take-profit target at the next resistance level.

5. Evening Star

The evening star is a three-candle bearish reversal pattern that forms at the top of an uptrend. It consists of a large bullish candle, followed by a small-bodied candle (which can be bullish, bearish, or a doji), and finally a strong bearish candle that closes well below the midpoint of the first candle. This pattern signals that buying momentum has weakened, and sellers are taking control.

The evening star pattern is considered highly reliable, especially when it forms near strong resistance levels. Its effectiveness is enhanced when the third candle has a high trading volume. Confirmation occurs when the next candle continues downward, closing below the third candle’s low.

Section	Details
Construction	First Candle: A large bullish candle continuing the existing uptrend. Second Candle: A small-bodied candle (often indecision or a doji) showing a pause. Third Candle: A strong bearish candle closing below the midpoint of the first candle.
Forecast	A bearish reversal is likely if confirmed by a strong red candle following through downward.
Type of Pattern	Three-candle bearish reversal pattern.
Trend Prior to the Pattern	Forms at the top of an uptrend, signaling a potential downward reversal.
Opposite Pattern	Morning Star
Stop-Loss Placement	Above the high of the indecision (second) candle or the evening star’s high.
Candlestick Success Rate In Accuracity:	55-68%

How Set Up a Trade with The Evening Star Candlestick Pattern:

1. Identify an evening star pattern at the top of an uptrend.
2. Wait for confirmation with the next candle closing below the evening star’s low.
3. Enter a sell trade at the close of the confirmation candle.
4. Place a stop-loss above the highest point of the pattern (second or first candle).
5. Set a take-profit target at the next support level.

6. Harami

The harami is a two-candle reversal pattern that can be either bullish or bearish, depending on the trend in which it forms. The pattern consists of a large first candle, followed by a second, smaller candle that is completely contained within the body of the first candle. This structure suggests a weakening of momentum and potential reversal.

A bullish harami appears at the bottom of a downtrend, where the first candle is bearish, and the second is a small bullish candle inside its range. This indicates that selling pressure is fading, and a possible reversal to the upside may follow. 

A bearish harami forms at the top of an uptrend, where the first candle is bullish, and the second is a small bearish candle, showing weakening buying pressure and a potential reversal downward.

Section	Details
Construction	First Candle: A strong bullish or bearish candle (depending on the trend). Second Candle: A small-bodied candle completely inside the first candle’s range.
Forecast	A reversal is likely if confirmed by the next candle closing beyond the second candle’s range.
Type of Pattern	Two-candle reversal pattern.
Trend Prior to the Pattern	A bullish harami appears in a downtrend, while a bearish harami appears in an uptrend.
Opposite Pattern	The opposite of a bullish harami is a bearish harami, and vice versa.
Stop-Loss Placement	Below the low of the second candle for a bullish harami, and above the high of the second candle for a bearish harami.
Candlestick Success Rate In Accuracity:	50%

How Set Up a Trade with The Harami Candlestick Pattern:

1. Identify a bullish harami at the bottom of a downtrend or a bearish harami at the top of an uptrend.
2. Wait for confirmation with the next candle closing above (for bullish) or below (for bearish) the harami pattern.
3. Enter a buy trade (for bullish harami) or sell trade (for bearish harami) at the close of the confirmation candle.
4. Place a stop-loss below the second candle’s low (bullish) or above its high (bearish).
5. Set a take-profit target at the next resistance (bullish) or support (bearish).

7. Hanging Man

The hanging man is a bearish reversal pattern that appears at the top of an uptrend. It looks identical to the hammer but occurs in an entirely different context. The candle has a small real body near the top and a long lower wick that is at least twice the size of the body, with little to no upper wick. 

It indicates that buyers pushed prices higher, but strong selling pressure later drove them lower before the price managed to close near its opening level. While the hanging man suggests a potential trend reversal, confirmation is required. 

Traders look for the next candle to close below the hanging man’s low, signaling that sellers have gained control. This pattern is more reliable when it appears at a strong resistance level and is accompanied by high trading volume.

Section	Details
Construction	Single Candle: A strong bullish candle before the hanging man.
Forecast	A bearish reversal is implied, but confirmation is required with the next candle closing below the hanging man’s low.
Type of Pattern	Single-candle bearish reversal pattern.
Trend Prior to the Pattern	Appears at the top of an uptrend, warning of a potential bearish reversal.
Opposite Pattern	Bullish Hammer
Stop-Loss Placement	Above the high of the hanging man’s wick (to allow price fluctuations while managing risk).
Candlestick Success Rate In Accuracity:	37,2 – 86%

How Set Up a Trade with The Hanging Man Candlestick Pattern:

1. Identify a hanging man at the top of an uptrend.
2. Wait for confirmation with the next candle closing below the hanging man’s low.
3. Enter a sell trade at the close of the confirmation candle.
4. Place a stop-loss above the high of the hanging man.
5. Set a take-profit target based on the next support level.

8. Doji

A doji is a single-candle pattern representing market indecision. It forms when the opening and closing prices are nearly identical, resulting in a very small or nonexistent real body. The upper and lower wicks vary in length, which creates different types of doji patterns.

Doji candles can appear in uptrends and downtrends and may signal either a continuation or reversal depending on the context. Traders wait for the next candle to determine the direction. The different types of doji include:

• Standard Doji: Has a small or nonexistent body with upper and lower wicks of similar length.
• Long-Legged Doji: Features extended upper and lower wicks, showing strong indecision.
• Dragonfly Doji: Has a long lower wick with little to no upper wick, signaling potential bullish reversal.
• Gravestone Doji: Has a long upper wick with little to no lower wick, indicating potential bearish reversal.
• Four-Price Doji: A rare pattern where open, high, low, and close are nearly the same, reflecting extreme indecision.

Section	Details
Construction	Single Candle: The open and close prices are nearly identical, with varying wick lengths.
Forecast	Indecision/neutral – no strong directional signal on its own. Price direction will depend on subsequent candles.
Type of Pattern	Single-candle indecision/neutral pattern.
Trend Prior to the Pattern	Can appear in any trend, often signaling a possible pause or reversal if confirmed by other patterns.
Opposite Pattern	N/A
Stop-Loss Placement	N/A (by itself, the doji doesn’t provide a specific entry; risk management depends on context and confirmation).
Candlestick Success Rate In Accuracity:	55%

How Set Up a Trade with The Doji Candlestick Pattern:

1. Identify a doji and consider the surrounding trend and support/resistance levels.
2. Wait for confirmation – bullish confirmation for a dragonfly doji, bearish confirmation for a gravestone doji.
3. Enter a trade in the direction of the confirming candle.
4. Place a stop-loss beyond the doji’s wick for protection.
5. Set a take-profit target based on the next support or resistance level.

9. Pin Bar 

The pin bar is a single-candle pattern that signals a potential price reversal. It has a small real body and a long wick (shadow) extending from one side, resembling a “pin.” The long wick indicates a strong rejection of price in that direction, with the market closing near the opposite end.

A bullish pin bar has a long lower wick and appears at the bottom of a downtrend, suggesting a reversal to the upside. A bearish pin bar has a long upper wick and forms at the top of an uptrend, indicating a reversal to the downside. Pin bars are most effective when they form at key support or resistance levels and when supported by other indicators such as moving averages or Fibonacci retracement levels.

Section	Details
Construction	Single Candle: Small real body with a long wick extending from one side.
Forecast	Signals a price rejection and potential trend reversal if confirmed by the next candle.
Type of Pattern	Single-candle reversal pattern.
Trend Prior to the Pattern	A bullish pin bar appears in a downtrend, while a bearish pin bar appears in an uptrend.
Opposite Pattern	Inverted pin bar (bullish vs. bearish).
Stop-Loss Placement	Below the low of a bullish pin bar or above the high of a bearish pin bar.
Candlestick Success Rate In Accuracity:	60%

How Set Up a Trade with The Pin Bar Candlestick Pattern:

1. Identify a pin bar at a key support (bullish) or resistance (bearish) level.
2. Wait for confirmation with the next candle moving in the expected direction.
3. Enter a buy trade (bullish pin bar) or sell trade (bearish pin bar) at the close of the confirmation candle.
4. Place a stop-loss below the wick of a bullish pin bar or above the wick of a bearish pin bar.
5. Set a take-profit target at the next resistance (bullish) or support (bearish) level.

10. Bullish Mat Hold 

The mat hold is a bullish continuation pattern that appears during an uptrend. It consists of a strong bullish candle, followed by a series of smaller bearish or neutral candles that remain within the range of the first candle. The final candle in the pattern is another strong bullish candle that breaks above the consolidation, confirming the continuation of the uptrend.

This pattern indicates that the market took a brief pause, but buyers remained in control. It is considered a stronger continuation signal than similar patterns because the bearish candles do not retrace too deeply into the first bullish candle’s range. 

Section	Details
Construction	Candle 1: A long bullish candle. Candles 2–4: Smaller bearish or neutral candles within the first candle’s range. Candle 5: A strong bullish candle that breaks above the consolidation.
Forecast	The uptrend is expected to continue after the breakout.
Type of Pattern	Multi-candle bullish continuation pattern.
Trend Prior to the Pattern	Seen in an uptrend, indicating a brief pause before further bullish momentum.
Opposite Pattern	Falling Three Methods
Stop-Loss Placement	Below the lowest point of the consolidation phase.
Candlestick Success Rate In Accuracity:	78%

How Set Up a Trade with The Mat Hold Candlestick Pattern:

1. Identify the mat hold pattern in an uptrend.
2. Wait for confirmation with the final breakout candle closing above the consolidation.
3. Enter a buy trade at the close of the breakout candle.
4. Place a stop-loss below the lowest point of the consolidation.
5. Set a take-profit target at the next resistance level.

11. Gap Up / Gap Down

The gap up and gap down patterns occur when a security opens significantly higher or lower than the previous day’s close without any trading in between. A gap up suggests strong buying interest, while a gap down indicates heavy selling pressure. These gaps can act as continuation signals if the trend follows through or reversal signals if the price fails to sustain the gap direction.

A breakaway gap happens at the beginning of a new trend, a runaway gap occurs during an existing trend, and an exhaustion gap appears near the end of a trend. The type of gap provides insight into the potential future price movement.

Section	Details
Construction	First Candle: The last trading session’s close price. Gap Formation: A noticeable price gap on the open of the next session. Second Candle: The price action that follows the gap, confirming or rejecting the move.
Forecast	A sustained gap suggests a continuation, while a filled gap may signal a reversal.
Type of Pattern	Single-day momentum pattern.
Trend Prior to the Pattern	Can occur in any trend but is more significant after a strong move.
Opposite Pattern	Opposite gaps (gap up vs. gap down).
Stop-Loss Placement	Below the gap (for a gap up) or above the gap (for a gap down).
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Gap Up / Gap Down Candlestick Pattern:

1. Identify a significant gap at market open.
2. Determine if the gap is a breakaway, runaway, or exhaustion gap.
3. Enter a trade in the gap’s direction if momentum continues.
4. Place a stop-loss below the gap (for gap up) or above the gap (for gap down).
5. Set a take-profit target based on the next support/resistance level.

12. Tri Star

The tri star is a rare three-candle reversal pattern that consists of three consecutive doji candles. This pattern indicates extreme market indecision and is usually found at the top or bottom of a trend, signaling a potential reversal.

A bullish tri star occurs after a downtrend, while a bearish tri star appears after an uptrend. Since doji candles represent equilibrium between buyers and sellers, three in a row suggest the market is struggling to continue in the current trend. Confirmation is needed with a strong move in the opposite direction following the pattern.

Section	Details
Construction	Candle 1: A doji appearing in a trending market. Candle 2: Another doji, confirming hesitation in the trend. Candle 3: A third doji, signaling a potential reversal setup.
Forecast	A reversal is expected if followed by a strong move in the opposite direction.
Type of Pattern	Three-candle reversal pattern.
Trend Prior to the Pattern	A bullish tri star appears in a downtrend, while a bearish tri star appears in an uptrend.
Opposite Pattern	A continuation pattern like three white soldiers (bullish) or three black crows (bearish).
Stop-Loss Placement	Below the low of the third doji (for bullish) or above the high of the third doji (for bearish).
Candlestick Success Rate In Accuracity:	62%

How Set Up a Trade with The Tri Star Candlestick Pattern:

1. Identify a tri star pattern at the top or bottom of a trend.
2. Wait for confirmation with a strong move in the opposite direction.
3. Enter a buy trade (for bullish tri star) or sell trade (for bearish tri star) at the close of the confirmation candle.
4. Place a stop-loss below the lowest doji (for bullish) or above the highest doji (for bearish).
5. Set a take-profit target based on the next support/resistance level.

13. Tweezer Top / Bottom

The tweezer top and tweezer bottom are two-candle reversal patterns that indicate a potential change in trend direction. A tweezer top forms at the peak of an uptrend and consists of two consecutive candles with similar highs, signaling that buyers are struggling to push the price higher. A tweezer bottom appears at the bottom of a downtrend and consists of two consecutive candles with nearly identical lows, suggesting that selling pressure is weakening.

These patterns work best when appearing at key support or resistance levels. The reliability increases when the second candle in the pattern is significantly larger than the first, showing strong rejection of higher (tweezer top) or lower (tweezer bottom) prices.

Section	Details
Construction	Candle 1: A bullish candle (for tweezer top) or bearish candle (for tweezer bottom). Candle 2: A bearish candle with the same high as Candle 1 (for tweezer top) or a bullish candle with the same low as Candle 1 (for tweezer bottom).
Forecast	A reversal is expected if confirmed by a strong move in the opposite direction.
Type of Pattern	Two-candle reversal pattern.
Trend Prior to the Pattern	A tweezer top appears in an uptrend, while a tweezer bottom appears in a downtrend.
Opposite Pattern	Tweezer top is opposite to tweezer bottom.
Stop-Loss Placement	Above the high (tweezer top) or below the low (tweezer bottom) of the pattern.
Candlestick Success Rate In Accuracity:	61%

How Set Up a Trade with The Tweezer Top / Bottom Candlestick Pattern:

1. Identify a tweezer top or tweezer bottom at key resistance or support levels.
2. Wait for confirmation with a strong move in the expected direction.
3. Enter a sell trade for a tweezer top or a buy trade for a tweezer bottom at the close of the confirmation candle.
4. Place a stop-loss above the tweezer top high or below the tweezer bottom low.
5. Set a take-profit target at the next support (for short trades) or resistance (for long trades).

14. Belt Hold

The belt hold is a single-candle reversal pattern that can be bullish or bearish, depending on its location in the trend. A bullish belt hold occurs after a downtrend and is represented by a long bullish candle with little to no lower wick, showing strong buying pressure from the open. A bearish belt hold appears after an uptrend and has a long bearish candle with little to no upper wick, signaling aggressive selling pressure from the open.

This pattern is most reliable when appearing at strong support (bullish) or resistance (bearish) levels. The absence of a wick on the opening side suggests a decisive shift in momentum.

Section	Details
Construction	Single Candle: A long real body with little to no wick on the opening side.
Forecast	A reversal is expected if confirmed by the next candle moving in the pattern’s direction.
Type of Pattern	Single-candle reversal pattern.
Trend Prior to the Pattern	A bullish belt hold appears in a downtrend, while a bearish belt hold appears in an uptrend.
Opposite Pattern	A bullish belt hold is opposite to a bearish belt hold.
Stop-Loss Placement	Below the low of a bullish belt hold or above the high of a bearish belt hold.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Belt Hold Candlestick Pattern:

1. Identify a bullish or bearish belt hold at a key support or resistance level.
2. Wait for confirmation with a follow-through candle closing in the expected direction.
3. Enter a buy trade (bullish belt hold) or sell trade (bearish belt hold) at the close of the confirmation candle.
4. Place a stop-loss below the belt hold’s low (bullish) or above its high (bearish).
5. Set a take-profit target at the next resistance (bullish) or support (bearish) level.

15. Abandoned Baby

The abandoned baby is a three-candle reversal pattern that signals a strong shift in market sentiment. It consists of a large candle in the direction of the trend, followed by a doji that gaps away from the previous candle, and then a strong candle moving in the opposite direction. This pattern is rare but highly reliable when it appears at key turning points.

A bullish abandoned baby appears at the end of a downtrend, while a bearish abandoned baby forms at the end of an uptrend. The gap between the doji and the surrounding candles is what makes this pattern unique.

Section	Details
Construction	Candle 1: A strong bullish or bearish candle continuing the trend. Candle 2: A doji that gaps away from the first candle. Candle 3: A strong candle in the opposite direction, confirming the reversal.
Forecast	A strong reversal is expected if the third candle confirms the move.
Type of Pattern	Three-candle reversal pattern.
Trend Prior to the Pattern	A bullish abandoned baby appears in a downtrend, while a bearish abandoned baby appears in an uptrend.
Opposite Pattern	Bullish abandoned baby is the opposite of a bearish abandoned baby.
Stop-Loss Placement	Below the low of a bullish abandoned baby or above the high of a bearish abandoned baby.
Candlestick Success Rate In Accuracity:	66%

How Set Up a Trade with The Abandoned Baby Candlestick Pattern:

1. Identify an abandoned baby pattern at a key reversal zone.
2. Wait for confirmation with a strong third candle moving in the opposite direction.
3. Enter a buy trade (bullish abandoned baby) or sell trade (bearish abandoned baby) at the close of the third candle.
4. Place a stop-loss below the abandoned baby’s low (bullish) or above its high (bearish).
5. Set a take-profit target at the next resistance (bullish) or support (bearish) level.

16. Kicker

The kicker pattern is a strong reversal formation that signals an abrupt shift in market sentiment. It consists of two large candles moving in opposite directions, with the second candle opening at or above/below the first candle’s open, forming a significant price gap. The pattern shows that a major shift in buying or selling pressure has occurred, often due to news or major market events.

A bullish kicker occurs when a strong bearish candle is followed by a bullish candle that gaps up and moves higher, showing that buyers have completely overpowered sellers. A bearish kicker is the opposite – after a strong bullish candle, the next session gaps down and moves lower, indicating heavy selling pressure.

Section	Details
Construction	Candle 1: A strong bearish or bullish candle. Candle 2: A large opposite-direction candle that gaps above or below the first candle’s open.
Forecast	A sharp trend reversal is expected if the gap remains unfilled.
Type of Pattern	Two-candle strong reversal pattern.
Trend Prior to the Pattern	Forms in both uptrends and downtrends, signaling a major momentum shift.
Opposite Pattern	A bullish kicker is the opposite of a bearish kicker.
Stop-Loss Placement	Below the second candle’s low (for bullish) or above its high (for bearish).
Candlestick Success Rate In Accuracity:	68%

How Set Up a Trade with The Kicker Candlestick Pattern:

1. Identify a kicker pattern with a significant price gap.
2. Wait for confirmation that the gap remains unfilled.
3. Enter a buy trade (bullish kicker) or sell trade (bearish kicker) at the close of the second candle.
4. Place a stop-loss below the second candle’s low (bullish) or above its high (bearish).
5. Set a take-profit target at the next support/resistance level.

17. Three Outside Up / Down

The three outside up and three outside down patterns are three-candle reversal formations that build upon the engulfing pattern concept. A three outside up is a bullish reversal that begins with a bearish candle, followed by a bullish engulfing candle, and is confirmed by another bullish candle closing above the second. 

A three outside down is the bearish counterpart, starting with a bullish candle, followed by a bearish engulfing candle, and a third bearish candle confirming the downward trend.

This pattern confirms a momentum shift by not only engulfing the previous candle but also following through with an additional confirmation candle, making it stronger than a standard engulfing pattern.

Section	Details
Construction	Candle 1: A small bearish candle (for three outside up) or a small bullish candle (for three outside down). Candle 2: A large engulfing candle in the opposite direction, fully covering Candle 1’s body. Candle 3: Another candle in the direction of Candle 2, confirming the new trend.
Forecast	A confirmed reversal is expected if the third candle continues the momentum.
Type of Pattern	Three-candle reversal pattern.
Trend Prior to the Pattern	Three outside up appears after a downtrend, while three outside down appears after an uptrend.
Opposite Pattern	Three outside up is opposite to three outside down.
Stop-Loss Placement	Below the second candle’s low (bullish) or above its high (bearish).
Candlestick Success Rate In Accuracity:	67%

How Set Up a Trade with The Three Outside Up / Down Candlestick Pattern:

1. Identify a three outside up or three outside down pattern at a key level.
2. Wait for confirmation with a third candle closing in the expected direction.
3. Enter a buy trade (three outside up) or sell trade (three outside down) at the close of the third candle.
4. Place a stop-loss below the second candle’s low (bullish) or above its high (bearish).
5. Set a take-profit target at the next support/resistance level.

18. Three Inside Up / Down

The three inside up and three inside down patterns are multi-candle reversal formations that build upon the harami pattern. A three inside up is a bullish reversal where the first candle is bearish, the second is a smaller bullish candle within the first candle’s range, and the third is another bullish candle that closes above the first candle’s high. 

A three inside down is the bearish counterpart, with a bullish first candle, a smaller bearish candle within its range, and a third bearish candle closing below the first candle’s low. This pattern is an improvement on the harami because it includes a third confirming candle, making it more reliable.

Section	Details
Construction	Candle 1: A strong bearish candle (for three inside up) or a strong bullish candle (for three inside down). Candle 2: A smaller opposite-direction candle inside the first candle’s body. Candle 3: A candle that closes beyond the first candle’s range, confirming the reversal.
Forecast	A confirmed reversal is expected if the third candle continues the trend shift.
Type of Pattern	Three-candle reversal pattern.
Trend Prior to the Pattern	Three inside up appears after a downtrend, while three inside down appears after an uptrend.
Opposite Pattern	Three inside up is opposite to three inside down.
Stop-Loss Placement	Below the second candle’s low (bullish) or above its high (bearish).
Candlestick Success Rate In Accuracity:	64%

How Set Up a Trade with The Three Inside Up / Down Candlestick Pattern:

1. Identify a three inside up or three inside down pattern at a key level.
2. Wait for confirmation with a third candle closing in the expected direction.
3. Enter a buy trade (three inside up) or sell trade (three inside down) at the close of the third candle.
4. Place a stop-loss below the second candle’s low (bullish) or above its high (bearish).
5. Set a take-profit target at the next support/resistance level.

19. Piercing Line

The piercing line is a bullish reversal pattern that appears at the bottom of a downtrend. It consists of a strong bearish candle followed by a bullish candle that opens below the previous low but then closes above the midpoint of the first candle’s body. This pattern suggests that selling pressure is fading and buyers are stepping in to drive prices higher.

Traders look for high volume on the second candle and follow-up bullish movement in the next few sessions for better confirmation. The piercing line works best at key support levels or after extended downward movements.

Section	Details
Construction	Candle 1: A strong bearish candle continuing the downtrend. Candle 2: A bullish candle that opens below the previous low but closes above the midpoint of Candle 1.
Forecast	A potential bullish reversal, confirmed by follow-through buying in subsequent candles.
Type of Pattern	Two-candle bullish reversal pattern.
Trend Prior to the Pattern	Forms after a downtrend, signaling a possible shift to bullish momentum.
Opposite Pattern	Dark Cloud Cover.
Stop-Loss Placement	Below the low of the second candle for risk protection.
Candlestick Success Rate In Accuracity:	64%

How Set Up a Trade with The Piercing Line Candlestick Pattern:

1. Identify a piercing line pattern forming after a downtrend.
2. Wait for confirmation with the next candle closing higher.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss below the low of the second candle.
5. Set a take-profit target at the next resistance level.

20. Dark Cloud Cover

The dark cloud cover is a bearish reversal pattern that appears at the top of an uptrend. It consists of a strong bullish candle followed by a bearish candle that opens above the previous high but then closes below the midpoint of the first candle’s body. This pattern signals a shift in momentum, as buyers initially push the price higher, but strong selling pressure forces it to close significantly lower.

The dark cloud cover is more effective when it forms at a key resistance level and is confirmed by further bearish movement in the following candles. Higher trading volume on the second candle strengthens the signal.

Section	Details
Construction	Candle 1: A strong bullish candle forming in an uptrend. Candle 2: A bearish candle that opens above the first candle’s high but closes below its midpoint.
Forecast	A bearish reversal is likely if confirmed by continued selling pressure.
Type of Pattern	Two-candle bearish reversal pattern.
Trend Prior to the Pattern	Forms after an uptrend, signaling a potential shift downward.
Opposite Pattern	Piercing Line.
Stop-Loss Placement	Above the high of the second candle to protect against false signals.
Candlestick Success Rate	65%

How Set Up a Trade with The Dark Cloud Cover Candlestick Pattern:

1. Identify a dark cloud cover pattern forming at a resistance level.
2. Wait for confirmation with another bearish candle closing lower.
3. Enter a sell trade at the close of the confirmation candle.
4. Place a stop-loss above the high of the second candle.
5. Set a take-profit target at the next support level.

21. Three Black Crows

The three black crows is a bearish reversal pattern that appears at the top of an uptrend. It consists of three consecutive long-bodied bearish candles, each opening within the previous candle’s body and closing near its low. 

This pattern indicates a shift in momentum from bullish to bearish, with sellers taking control. For better confirmation, the candles should have small or no wicks, as this signifies strong selling pressure. The pattern is more effective when it appears near a resistance level or after a period of overbought conditions. If the pattern forms on high volume, it further confirms the bearish sentiment.

Section	Details
Construction	Candle 1: A strong bearish candle marking the beginning of selling pressure. Candle 2: Another bearish candle opening within the first candle’s body and closing lower. Candle 3: A third bearish candle continuing the same pattern, confirming the downward trend.
Forecast	A strong continuation of the downtrend is expected if the pattern forms with high volume.
Type of Pattern	Three-candle bearish reversal pattern.
Trend Prior to the Pattern	Forms after an uptrend, signaling a shift to bearish momentum.
Opposite Pattern	Three White Soldiers.
Stop-Loss Placement	Above the high of the first candle to protect against a false signal.
Candlestick Success Rate In Accuracity:	78%

How Set Up a Trade with The Three Black Crows Candlestick Pattern:

1. Identify the three black crows pattern forming after an uptrend.
2. Wait for confirmation with continued bearish movement on the next candle.
3. Enter a sell trade at the close of the third bearish candle.
4. Place a stop-loss above the high of the first candle in the pattern.
5. Set a take-profit target at the next support level.

22. Rising Three Methods

The rising three methods is a bullish continuation pattern that occurs during an uptrend. It consists of a strong bullish candle, followed by three or more small bearish candles that remain within the first candle’s range, and a final strong bullish candle that closes above the first candle’s high.

This pattern signals a brief consolidation before the prevailing uptrend resumes. The key aspect of spotting is that the small bearish candles should not break below the first candle’s low, confirming that selling pressure is weak.

Section	Details
Construction	Candle 1: A strong bullish candle initiating the pattern. Candles 2-4: Three or more small bearish candles within the first candle’s range. Candle 5: A strong bullish candle closing above the highest point of the first candle.
Forecast	The uptrend is expected to continue after the breakout.
Type of Pattern	Multi-candle bullish continuation pattern.
Trend Prior to the Pattern	Forms during an uptrend, signaling further bullish momentum.
Opposite Pattern	Falling Three Methods.
Stop-Loss Placement	Below the lowest point of the consolidation phase.
Candlestick Success Rate In Accuracity:	74%

How Set Up a Trade with The Rising Three Candlestick Pattern:

1. Identify a rising three methods pattern forming in an uptrend.
2. Wait for confirmation with the final breakout candle closing above the consolidation.
3. Enter a buy trade at the close of the breakout candle.
4. Place a stop-loss below the lowest point of the consolidation.
5. Set a take-profit target at the next resistance level.

23. Falling Three Methods

The falling three methods is a bearish continuation pattern that appears during a downtrend. It consists of a strong bearish candle, followed by three or more small bullish candles that remain within the first candle’s range, and a final strong bearish candle that closes below the first candle’s low.

This pattern shows that the market is temporarily pausing, but the overall downtrend remains intact. The small bullish candles must stay within the range of the first candle, confirming weak buying pressure.

Section	Details
Construction	Candle 1: A strong bearish candle initiating the pattern. Candles 2-4: Three or more small bullish candles within the first candle’s range. Candle 5: A strong bearish candle closing below the lowest point of the first candle.
Forecast	The downtrend is expected to continue after the breakdown.
Type of Pattern	Multi-candle bearish continuation pattern.
Trend Prior to the Pattern	Forms during a downtrend, signaling further bearish momentum.
Opposite Pattern	Rising Three Methods.
Stop-Loss Placement	Above the highest point of the consolidation phase.
Candlestick Success Rate In Accuracity:	72%

How Set Up a Trade with The Falling Three Candlestick Pattern:

1. Identify a falling three methods pattern forming in a downtrend.
2. Wait for confirmation with the final breakdown candle closing below the consolidation.
3. Enter a sell trade at the close of the breakdown candle.
4. Place a stop-loss above the highest point of the consolidation.
5. Set a take-profit target at the next support level.

24. Tasuki Gap

The Tasuki gap is a continuation pattern that appears during strong trends, either bullish or bearish. It consists of three candles: a trend-following candle, a gap in the direction of the trend, and a pullback candle that partially fills the gap but does not close it completely.

A bullish Tasuki gap forms in an uptrend when a second bullish candle gaps up from the first, followed by a small bearish candle that retraces but does not close the gap. A bearish Tasuki gap occurs in a downtrend, where the second bearish candle gaps down, followed by a small bullish candle that partially retraces but fails to close the gap.

Section	Details
Construction	Candle 1: A trend-following bullish or bearish candle. Candle 2: Another candle in the same direction that gaps away from Candle 1. Candle 3: A pullback candle that partially retraces but does not close the gap.
Forecast	The prevailing trend is expected to continue if the gap remains unfilled.
Type of Pattern	Three-candle continuation pattern.
Trend Prior to the Pattern	A bullish Tasuki gap appears in an uptrend, while a bearish Tasuki gap appears in a downtrend.
Opposite Pattern	Bullish Tasuki Gap is opposite to Bearish Tasuki Gap.
Stop-Loss Placement	Below the gap (for bullish) or above the gap (for bearish).
Candlestick Success Rate In Accuracity:	54%

How Set Up a Trade with The Tasuki Gap Candlestick Pattern:

1. Identify a Tasuki gap forming in an existing trend.
2. Wait for confirmation that the gap remains unfilled.
3. Enter a buy trade (bullish Tasuki gap) or sell trade (bearish Tasuki gap) at the close of the third candle.
4. Place a stop-loss below the gap (bullish) or above the gap (bearish).
5. Set a take-profit target at the next key support/resistance level.

25. Inside Bar

The inside bar is a two-candle pattern where the second candle is completely contained within the range of the first candle. It represents market consolidation and is often a sign of trend continuation or reversal, depending on the breakout direction.

A bullish inside bar happens in an uptrend and shows continued bullish momentum if the price breaks above the pattern. A bearish inside bar forms in a downtrend and signals continued selling pressure if the price breaks below the pattern.

Section	Details
Construction	Candle 1: A large bullish or bearish candle. Candle 2: A smaller candle completely inside the range of Candle 1.
Forecast	A breakout is expected; direction depends on whether the price moves above or below the inside bar’s range.
Type of Pattern	Two-candle consolidation pattern.
Trend Prior to the Pattern	Can form in both uptrends and downtrends, signaling continuation or reversal.
Opposite Pattern	Outside Bar.
Stop-Loss Placement	Below the low (for bullish breakout) or above the high (for bearish breakout) of the inside bar.
Candlestick Success Rate In Accuracity:	50 – 65%

How Set Up a Trade with The Inside Bar Candlestick Pattern:

1. Identify an inside bar pattern forming in a trending market.
2. Wait for confirmation with a breakout above or below the inside bar’s range.
3. Enter a buy trade if price breaks above or a sell trade if price breaks below.
4. Place a stop-loss below the low (bullish) or above the high (bearish) of the inside bar.
5. Set a take-profit target at the next resistance (bullish) or support (bearish) level.

26. Outside Bar

The outside bar is a two-candle pattern where the second candle completely engulfs the range of the first candle. This pattern shows increased volatility and is often a sign of a trend reversal or continuation, depending on the breakout direction.

A bullish outside bar forms when the second candle surpasses both the high and low of the previous candle, closing with strong upward momentum. This suggests that buyers have taken control after initial market uncertainty. 

However, a bearish outside bar develops when the second candle extends beyond the first but finishes lower, signaling that sellers have overpowered buyers and momentum has shifted downward.

Section	Details
Construction	Candle 1: A small or moderate-sized bullish or bearish candle. Candle 2: A large candle that engulfs the entire range of Candle 1.
Forecast	A breakout move is expected; the direction depends on the closing price of the second candle.
Type of Pattern	Two-candle volatility pattern.
Trend Prior to the Pattern	Can form in both uptrends and downtrends, signaling continuation or reversal.
Opposite Pattern	Inside Bar
Stop-Loss Placement	Below the low (for bullish breakout) or above the high (for bearish breakout) of the outside bar.
Candlestick Success Rate In Accuracity:	50 – 65%

How Set Up a Trade with The Outside Bar Candlestick Pattern:

1. Identify an outside bar pattern forming in a trending market.
2. Wait for confirmation with a breakout above or below the outside bar’s range.
3. Enter a buy trade if the price breaks above or a sell trade if the price breaks below.
4. Place a stop-loss below the low (bullish) or above the high (bearish) of the outside bar.
5. Set a take-profit target at the next resistance (bullish) or support (bearish) level.

27. Spinning Top

The spinning top is a single-candle pattern that signals market indecision. It has a small real body positioned in the middle of the candle’s range, with long upper and lower wicks. This structure indicates that buyers and sellers actively pushed prices in both directions during the session, but neither side could maintain control, leading to a close near the opening price.

When a spinning top appears after a strong price move, it suggests the trend could be losing momentum. However, it does not confirm a reversal on its own – traders look for follow-up price action to determine whether the trend will continue or reverse. If the next candle confirms direction with a strong close, it provides a clearer trading signal.

Section	Details
Construction	Single Candle: Small real body in the middle, with long upper and lower wicks.
Forecast	A potential reversal if followed by a strong move in the opposite direction.
Type of Pattern	Single-candle neutral pattern.
Trend Prior to the Pattern	Can appear in any trend, with significance increasing after strong moves.
Opposite Pattern	Marubozu.
Stop-Loss Placement	Below the low (for bullish confirmation) or above the high (for bearish confirmation).
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Spinning Top Candlestick Pattern:

1. Identify a spinning top pattern forming after a trend.
2. Wait for confirmation with a strong bullish or bearish candle.
3. Enter a buy trade if a bullish candle follows or a sell trade if a bearish candle follows.
4. Place a stop-loss below the low (bullish) or above the high (bearish) of the spinning top.
5. Set a take-profit target at the next key support/resistance level.

28. Popgun

The popgun pattern is a two-candle breakout setup that signals an imminent surge in price movement. It starts with an inside bar, a candle that is fully contained within the range of the previous candle. 

This shows consolidation, where traders are indecisive, and price is contracting. The second candle, known as the outside bar, fully engulfs the range of both previous candles, signaling an explosion in momentum.

Unlike other breakout patterns, the popgun combines compression and expansion, making it a strong signal for an impending directional move. Wait for the breakout direction, as the outside bar can lead to a continuation of the trend or a sharp reversal.

Section	Details
Construction	Candle 1: A large bullish or bearish candle. Candle 2: An inside bar, fully contained within the first candle’s range. Candle 3: A large outside bar engulfing both previous candles.
Forecast	A strong breakout in the direction of the third candle.
Type of Pattern	Three-candle breakout pattern.
Trend Prior to the Pattern	Can form in uptrends, downtrends, or ranging markets before a breakout.
Opposite Pattern	No direct opposite.
Stop-Loss Placement	Below the low (for bullish breakout) or above the high (for bearish breakout).
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Popgun Candlestick Pattern:

1. Identify a popgun pattern forming at a key market structure level.
2. Wait for confirmation with a breakout candle following the popgun.
3. Enter a buy trade if the third candle is bullish or a sell trade if bearish.
4. Place a stop-loss below the low (bullish) or above the high (bearish) of the popgun.
5. Set a take-profit target based on the next support or resistance level.

29. Shaven Head

The shaven head is a momentum candle that reflects one-sided control in the market. Its defining characteristic is the lack of an upper wick, meaning the price opened at a lower level and moved consistently higher throughout the session before closing at its peak. This shows that buyers dominated price action from start to finish without encountering significant resistance.

Because of its structure, the shaven head is seen as a sign of strong trend continuation. It is strong when it appears after a breakout or near a key support/resistance level. The absence of an upper wick suggests buyers were confident enough to sustain momentum until the close, increasing the probability of further price appreciation.

Section	Details
Construction	Single Candle: No upper wick, real body extending to the high.
Forecast	A continuation of the trend if confirmed by the next few candles.
Type of Pattern	Single-candle trend continuation pattern.
Trend Prior to the Pattern	A bullish shaven head appears in an uptrend, while a bearish shaven head appears in a downtrend.
Opposite Pattern	Shaven Bottom.
Stop-Loss Placement	Below the low (for bullish) or above the high (for bearish).
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Shaven Head Candlestick Pattern:

1. Identify a shaven head pattern in an existing trend.
2. Wait for confirmation with continued movement in the same direction.
3. Enter a buy trade for a bullish shaven head or a sell trade for a bearish shaven head.
4. Place a stop-loss below the low (bullish) or above the high (bearish) of the shaven head candle.
5. Set a take-profit target at the next resistance (bullish) or support (bearish) level.

30. Shaven Bottom

The shaven bottom is a single-candle momentum pattern that signals strong selling or buying pressure. It has no lower wick, meaning the price opened and remained in control of one side throughout the session before closing at the extreme end. This structure indicates that sellers (in a bearish trend) or buyers (in a bullish trend) showed no hesitation, pushing the price decisively in one direction.

Section	Details
Construction	Single Candle: A full-bodied candle with no lower wick.
Forecast	The trend is expected to continue if the next candle confirms the move.
Type of Pattern	Single-candle trend continuation pattern.
Trend Prior to the Pattern	A bullish shaven bottom appears in an uptrend, while a bearish shaven bottom appears in a downtrend.
Opposite Pattern	Shaven Head.
Stop-Loss Placement	Below the low (for bullish) or above the high (for bearish).
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Shaven Bottom Candlestick Pattern:

1. Identify a shaven bottom pattern in a trending market.
2. Wait for confirmation with continued movement in the same direction.
3. Enter a buy trade for a bullish shaven bottom or a sell trade for a bearish shaven bottom.
4. Place a stop-loss below the low (bullish) or above the high (bearish) of the candle.
5. Set a take-profit target at the next key support or resistance level.

31. High Wave Candlestick Pattern

The high wave candlestick is a single-candle pattern that signals market uncertainty and potential reversal. It has a small real body with long upper and lower wicks, showing that the price fluctuated significantly but closed near its opening level. This pattern suggests that both buyers and sellers were active, but neither was able to establish clear control.

High wave candles often appear at key turning points after strong price movements. While they do not confirm a reversal alone, they act as early warnings of momentum exhaustion. Traders wait for a confirmation candle to determine whether a trend reversal or continuation is likely.

Section	Details
Construction	Single Candle: Small real body with long upper and lower wicks.
Forecast	A reversal is possible if the next candle confirms a change in trend.
Type of Pattern	Single-candle neutral pattern.
Trend Prior to the Pattern	Can appear in both uptrends and downtrends but is more significant after strong trends.
Opposite Pattern	No direct opposite.
Stop-Loss Placement	Below the low (for bullish confirmation) or above the high (for bearish confirmation).
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The High Wave Candlestick Pattern:

1. Identify a high wave candle near a key price level.
2. Wait for confirmation with a strong bullish or bearish candle.
3. Enter a buy trade if a bullish candle follows or a sell trade if a bearish candle follows.
4. Place a stop-loss below the low (bullish) or above the high (bearish) of the high wave candle.
5. Set a take-profit target at the next resistance (bullish) or support (bearish) level.

32. Separating Lines

The separating lines is a two-candle continuation pattern that reinforces the prevailing trend. It consists of a strong trend candle followed by another candle of the opposite color that opens at the same level as the previous candle’s open but moves in the trend direction. This pattern suggests a brief pullback was met with immediate rejection, leading to continued movement in the dominant trend.

Section	Details
Construction	Candle 1: A trend-following bullish or bearish candle. Candle 2: A candle of the opposite color that opens at the same level as Candle 1’s open but moves in the trend direction.
Forecast	A continuation of the trend is expected if the second candle closes decisively.
Type of Pattern	Two-candle trend continuation pattern.
Trend Prior to the Pattern	A bullish separating lines appears in an uptrend, while a bearish separating lines appears in a downtrend.
Opposite Pattern	Bullish Separating Lines is opposite to Bearish Separating Lines.
Stop-Loss Placement	Below the low (for bullish continuation) or above the high (for bearish continuation).
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Separating Lines Candlestick Pattern:

1. Identify a separating lines pattern forming in an existing trend.
2. Wait for confirmation that the second candle closes strongly in the trend direction.
3. Enter a buy trade (bullish separating lines) or sell trade (bearish separating lines).
4. Place a stop-loss below the low (bullish) or above the high (bearish) of the second candle.
5. Set a take-profit target at the next key support/resistance level.

33. On Neck

The on neck pattern is a two-candle bearish continuation pattern that forms during a downtrend. It starts with a long bearish candle, followed by a smaller bullish candle that opens lower but closes right at or just slightly above the previous candle’s close without closing above its body midpoint. This subtle move shows a failed attempt by buyers to reverse the trend.

Since the bullish candle fails to recover any meaningful ground, the pattern suggests that sellers are still firmly in control. It’s considered more of a stalling pattern than a sharp reversal, but when confirmed by further downside movement, it reinforces the continuation of the bearish trend.

Section	Details
Construction	Candle 1: A long bearish candle in a downtrend. Candle 2: A small bullish candle opening below Candle 1’s close and closing at or slightly above it.
Forecast	Bearish continuation is expected if followed by further downside price action.
Type of Pattern	Two-candle bearish continuation pattern.
Trend Prior to the Pattern	Forms during a downtrend.
Opposite Pattern	No direct opposite.
Stop-Loss Placement	Above the high of the second candle to limit risk.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The On Neck Candlestick Pattern:

1. Identify the on neck pattern forming in a downtrend.
2. Wait for confirmation with the next candle closing below the on neck setup.
3. Enter a sell trade at the close of the confirmation candle.
4. Place a stop-loss above the high of the second candle.
5. Set a take-profit target at the next support level.

34. In Neck

The in neck pattern is another bearish continuation signal that also forms during a downtrend. It closely resembles the on neck pattern but with a key difference: the second candle. It’s bullish and smaller, closes slightly higher than the previous candle’s close but still below its midpoint. This subtle bullish response shows weak buying interest that isn’t strong enough to shift momentum.

Traders use the in neck pattern to identify a momentary slowdown in selling before the downtrend resumes. It’s not an aggressive setup, but it’s often part of a broader sequence of bearish signals, especially when supported by volume or confirmation candles.

Section	Details
Construction	Candle 1: A long bearish candle. Candle 2: A small bullish candle closing slightly higher than Candle 1’s close but not above its midpoint.
Forecast	Bearish continuation is likely, especially with confirmation from the next session.
Type of Pattern	Two-candle bearish continuation pattern.
Trend Prior to the Pattern	Forms in a downtrend.
Opposite Pattern	No direct opposite.
Stop-Loss Placement	Above the high of the second candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The In Neck Candlestick Pattern:

1. Spot an in neck pattern during a strong downtrend.
2. Wait for a confirming candle to close below the setup.
3. Enter a short position at the close of the confirmation candle.
4. Place a stop-loss just above the second candle’s high.
5. Set a take-profit level near the next support zone or use a fixed risk-reward ratio.

35. Breakaway

The breakaway is a five-candle reversal pattern that can appear at the start of a new trend, either bullish or bearish. It begins with a strong candle in the direction of the existing trend, followed by three progressively smaller candles that move against it and ends with a large candle that closes beyond the range of the prior candles, marking a potential breakout in the opposite direction.

A bullish breakaway starts with a long bearish candle, followed by three small upward-moving candles, and finishes with a strong bullish candle that closes above the first candle’s open. A bearish breakaway has the opposite structure. This pattern shows a slow loss of momentum and then a sudden shift in control, often signaling a true reversal.

Section	Details
Construction	Candle 1: A strong trend candle. Candles 2–4: Small-bodied candles moving against the initial trend. Candle 5: A large candle that closes beyond the range of the previous four.
Forecast	A confirmed reversal is likely if the fifth candle closes strongly.
Type of Pattern	Five-candle reversal pattern.
Trend Prior to the Pattern	Can appear after strong uptrends or downtrends.
Opposite Pattern	A bullish breakaway is opposite to a bearish breakaway.
Stop-Loss Placement	Below the low (bullish) or above the high (bearish) of the fifth candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Breakaway Candlestick Pattern:

1. Identify a breakaway pattern forming after an extended trend.
2. Wait for the fifth candle to close beyond the previous candle range.
3. Enter a trade in the direction of the breakout candle.
4. Place a stop-loss below the low (bullish) or above the high (bearish).
5. Set a take-profit level at the next major support/resistance or use a trailing stop.

36. Concealing Baby Swallow

The concealing baby swallow is a rare four-candle bearish reversal pattern that forms during a downtrend and signals the potential for sharp continuation. It’s composed entirely of black (bearish) candles, where the third candle is a small body that gets completely engulfed by the fourth candle. 

The second and third candles both have long lower shadows, suggesting that buyers tried to push the price up but were completely overwhelmed by the sellers. It’s found near resistance zones or after a brief consolidation and is seen as a strong continuation signal rather than a reversal.

Section	Details
Construction	Candle 1: A full-bodied bearish candle. Candle 2: Another bearish candle with a long lower shadow. Candle 3: A small bearish candle with a long lower shadow. Candle 4: A large bearish candle that completely engulfs Candle 3.
Forecast	Strong downside continuation is expected.
Type of Pattern	Four-candle bearish continuation pattern.
Trend Prior to the Pattern	Forms during a downtrend or after minor consolidation.
Opposite Pattern	None directly opposite.
Stop-Loss Placement	Above the high of the fourth candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Concealing Baby Swallow Candlestick Pattern:

1. Identify the concealing baby swallow during a downtrend.
2. Wait for the fourth candle to close strongly and engulf the third.
3. Enter a short trade at the close of the engulfing candle.
4. Place a stop-loss above the high of the fourth candle.
5. Set a take-profit near the next support level or use a trailing stop for extended moves.

37. Homing Pigeon

The homing pigeon is a two-candle bullish reversal pattern that appears during a downtrend. It consists of two consecutive bearish candles, where the second candle is entirely contained within the body of the first. The homing pigeon pattern is similar to the bullish harami, but both candles are bearish, which makes it less obvious at first glance.

This pattern signals that the selling pressure is starting to weaken, even though the candles are still bearish. The smaller body on the second candle shows hesitation by sellers. If followed by a bullish confirmation candle, it can indicate a shift in momentum and a possible reversal to the upside.

Section	Details
Construction	Candle 1: A large bearish candle continuing the downtrend. Candle 2: A smaller bearish candle entirely within Candle 1’s body.
Forecast	A reversal is possible if confirmed by a strong bullish candle following the pattern.
Type of Pattern	Two-candle bullish reversal pattern.
Trend Prior to the Pattern	Forms during a downtrend.
Opposite Pattern	Matching Low or Bearish Harami (depending on structure and trend).
Stop-Loss Placement	Below the low of the second candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Homing Pigeon Candlestick Pattern:

1. Spot the homing pigeon pattern forming after a decline.
2. Wait for confirmation with a bullish candle breaking above both bearish candles.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss below the low of the second candle.
5. Set a take-profit target near the next resistance level.

38. Ladder Bottom

The ladder bottom is a five-candle bullish reversal pattern that develops after a strong downtrend. It starts with three consecutive bearish candles, each making lower lows, followed by a small-bodied doji or spinning top that reflects indecision. The final candle is a strong bullish candle that closes above the prior candle’s high, confirming a potential reversal.

The pattern represents a shift in sentiment, where sellers initially stay in control, but their strength diminishes by the fourth candle. The fifth candle serves as confirmation that buyers have stepped in, turning the momentum in their favor.

Section	Details
Construction	Candles 1–3: Bearish candles making lower lows. Candle 4: A doji or small real-bodied candle signaling indecision. Candle 5: A bullish candle that closes above the high of the fourth candle.
Forecast	A bullish reversal is likely if the fifth candle closes strong.
Type of Pattern	Five-candle bullish reversal pattern.
Trend Prior to the Pattern	Appears during a strong downtrend.
Opposite Pattern	Ladder Top.
Stop-Loss Placement	Below the low of the fourth candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Ladder Bottom Candlestick Pattern:

1. Identify the ladder bottom forming during a downtrend.
2. Wait for the fifth candle to close above the fourth candle’s high.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss below the low of the fourth candle.
5. Set a take-profit target at the next resistance or structure zone.

39. Ladder Top

The ladder top is the bearish counterpart of the ladder bottom and appears after a strong uptrend. It consists of three consecutive bullish candles making higher highs, followed by a small-bodied candle that signals hesitation. The fifth candle is a strong, bearish candle that closes below the low of the fourth candle, confirming the potential reversal.

The pattern reflects a market where buyers are gradually losing control. The early bullish candles indicate strength, but as the fourth candle flattens out, momentum is stalling. When sellers take over with a strong push down, the trend is likely to reverse.

Section	Details
Construction	Candles 1–3: Bullish candles making higher highs. Candle 4: A small-bodied candle, showing hesitation. Candle 5: A strong bearish candle closing below Candle 4’s low.
Forecast	A reversal to the downside is likely if the fifth candle confirms the move.
Type of Pattern	Five-candle bearish reversal pattern.
Trend Prior to the Pattern	Forms during an uptrend.
Opposite Pattern	Ladder Bottom.
Stop-Loss Placement	Above the high of the fifth candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Ladder Top Candlestick Pattern:

1. Identify the ladder top forming in a rising market.
2. Wait for the fifth candle to close below the previous candle’s low.
3. Enter a sell trade at the close of the bearish confirmation candle.
4. Place a stop-loss above the high of the fifth candle.
5. Set a take-profit target at the next support level or use a fixed risk-to-reward ratio.

40. Matching High

The matching high is a two-candle bearish reversal pattern that forms during an uptrend. It features two consecutive bullish candles that close at or very near the same price, even though they might have different opening levels or wicks. This repeated failure to close higher shows that buying momentum may be stalling, creating a potential reversal setup.

What makes this pattern significant is the repeated rejection at a consistent closing level. It suggests that resistance is holding firm, and buyers are losing their edge. When confirmed by a bearish candle that follows, the matching high often precedes a shift in trend direction.

Section	Details
Construction	Candle 1: A bullish candle forming in an uptrend. Candle 2: Another bullish candle that closes at the same level as Candle 1.
Forecast	A potential bearish reversal is expected if followed by a bearish confirmation candle.
Type of Pattern	Two-candle bearish reversal pattern.
Trend Prior to the Pattern	Forms in an uptrend.
Opposite Pattern	Matching Low (a bullish reversal version).
Stop-Loss Placement	Above the high of the second candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Matching High Candlestick Pattern:

1. Identify a matching high pattern at a resistance level.
2. Wait for confirmation with a strong bearish candle.
3. Enter a sell trade at the close of the confirmation candle.
4. Place a stop-loss above the high of the second matching candle.
5. Set a take-profit target near the next support level.

41. Matching Low

The matching low is a bullish reversal pattern that develops during a downtrend. It involves two consecutive bearish candles that close at the same or nearly identical level. This repeated failure to close lower signals potential support, suggesting that sellers are struggling to push the price further down.

The pattern is more reliable when it forms at or near a major support zone or psychological price level. Although both candles are bearish, the repeated closing price shows that selling momentum may be weakening. Traders wait for a bullish candle afterward to confirm the reversal.

Section	Details
Construction	Candle 1: A bearish candle forming during a downtrend. Candle 2: Another bearish candle closing at the same level as the first.
Forecast	A bullish reversal is likely if confirmed by a bullish candle afterward.
Type of Pattern	Two-candle bullish reversal pattern.
Trend Prior to the Pattern	Appears in a downtrend.
Opposite Pattern	Matching High.
Stop-Loss Placement	Below the low of the second candle.
Candlestick Success Rate In Accuracity:	61%

How Set Up a Trade with The Matching Low Candlestick Pattern:

1. Identify a matching low forming during a decline.
2. Wait for confirmation from a bullish candle closing higher.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss just below the second candle’s low.
5. Set a take-profit target near the next resistance or based on a fixed ratio.

42. Meeting Lines

The meeting lines is a two-candle reversal pattern that appears in uptrends and downtrends. It features two candles of opposite color that close at nearly the same price, creating a visual alignment or “meeting” at the close. This pattern signals a potential stall in the current trend and the possibility of a reversal.

A bullish meeting lines pattern forms after a decline, where a strong bearish candle is followed by a bullish candle that opens lower but closes at the same level as the first candle’s close. A bearish version forms after an uptrend, where the bullish candle is followed by a bearish candle that closes at the same price.

Section	Details
Construction	Candle 1: A strong candle in the direction of the trend. Candle 2: An opposite-color candle that closes at the same price as Candle 1.
Forecast	A potential reversal is expected if the next candle supports the shift.
Type of Pattern	Two-candle reversal pattern.
Trend Prior to the Pattern	Appears during strong trends, either up or down.
Opposite Pattern	Bullish meeting lines contrast and bearish meeting lines.
Stop-Loss Placement	Below the low (bullish) or above the high (bearish) of the second candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Meeting Lines Candlestick Pattern:

1. Identify a meeting lines pattern at a key support or resistance level.
2. Wait for confirmation with a third candle moving in the new direction.
3. Enter a trade at the close of the confirmation candle.
4. Place a stop-loss on the opposite side of the second candle.
5. Target the next resistance (bullish) or support (bearish) area for exits.

43. Bullish Side by Side White Lines

Side by side white lines is a bullish continuation pattern that forms during an uptrend. It begins with a strong bullish candle, followed by a gap up that leads into another bullish candle of similar size and structure. The two candles sit “side by side,” showing consistent buying pressure and confirming the strength of the trend.

The Side by Side White Lines pattern reflects market confidence. The gap between the first and second candles suggests urgency from buyers, and the similar structure of the candles shows steady participation without hesitation. It’s most effective in fast-moving markets where momentum tends to persist.

Section	Details
Construction	Candle 1: A strong bullish candle in an uptrend. Candle 2: Another bullish candle that opens with a gap and closes near the first candle’s close.
Forecast	Bullish continuation expected if the pattern is followed by another upward candle.
Type of Pattern	Two-candle bullish continuation pattern.
Trend Prior to the Pattern	Forms during an established uptrend.
Opposite Pattern	Side by side black lines
Stop-Loss Placement	Below the low of the first candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Side by Side White Lines Candlestick Pattern:

1. Identify the side by side white lines forming an uptrend.
2. Wait for a third bullish candle for confirmation.
3. Enter a buy trade at the close of the third candle.
4. Place a stop-loss below the low of the first candle.
5. Target the next resistance level or use a trailing stop to ride the trend.

44. Bullish Stick Sandwich

The stick sandwich is a bullish reversal pattern consisting of three candles, where a bearish candle is followed by a bullish candle, and then another bearish candle that closes at the same price as the first. Despite the presence of bearish candles on both ends, the failure to push price lower signals potential support and a possible reversal to the upside.

This pattern reflects the market’s inability to break through a support level. Even though sellers attempted to regain control on the third candle, the repeated close at the same price shows buyers are defending that level. A bullish candle that follows confirms the setup.

Section	Details
Construction	Candle 1: A bearish candle closing at a support level. Candle 2: A bullish candle closing above Candle 1’s open. Candle 3: A bearish candle closing at or near Candle 1’s close.
Forecast	A bullish reversal is likely if the next candle confirms upward movement.
Type of Pattern	Three-candle bullish reversal pattern.
Trend Prior to the Pattern	Appears in a downtrend.
Opposite Pattern	None direct, but can contrast with Three Black Crows in effect.
Stop-Loss Placement	Below the low of the third candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Stick Sandwich Candlestick Pattern:

1. Spot a stick sandwich forming after a downtrend.
2. Wait for a bullish candle to close above the third candle’s high.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss just below the third candle’s low.
5. Set a take-profit target near the next resistance.

45. Three Line Strike

The three line strike is a four-candle reversal pattern that appears at the end of a trend. It begins with three candles moving in the same direction, each closing progressively higher (bullish) or lower (bearish), followed by a strong opposite-direction candle that engulfs the range of the previous three. Despite appearing counter-trend, this pattern often confirms the original direction instead of reversing it.

A bullish three line strike has three green candles followed by one large red candle. If the price resumes upward after the fourth candle, it’s a strong bullish continuation. Likewise, a bearish three line strike begins with three red candles and ends with a large bullish candle before trend continuation.

Section	Details
Construction	Candles 1–3: Three candles moving steadily in the trend’s direction. Candle 4: A large opposite-direction candle engulfing all three prior candles.
Forecast	Trend continuation is likely if the next candle resumes in the direction of the first three.
Type of Pattern	Four-candle continuation pattern.
Trend Prior to the Pattern	Appears in trending markets (either bullish or bearish).
Opposite Pattern	None directly.
Stop-Loss Placement	Below the low (bullish) or above the high (bearish) of the fourth candle.
Candlestick Success Rate In Accuracity:	84%

How Set Up a Trade with The Three Line Strike Candlestick Pattern:

1. Identify a three line strike pattern in a trending market.
2. Wait for the fifth candle to resume the original trend.
3. Enter a trade in the direction of the first three candles.
4. Place a stop-loss beyond the extreme of the fourth candle.
5. Use a take-profit based on the trend’s next projected leg or recent highs/lows.

46. Unique Three River Bottom

The unique three river bottom is a bullish reversal pattern that forms during a downtrend. It consists of three candles: the first is a large bearish candle, the second is a small-bodied candle (often a spinning top or doji), and the third is a bullish candle that closes above the second. This combination shows a gradual shift in sentiment from bearish to bullish.

Unlike more aggressive reversal patterns, this setup emphasizes subtle weakening of selling pressure followed by a bullish confirmation. Watch for the third candle to close higher to validate the reversal and use it in conjunction with other tools like volume, RSI, or support levels to increase reliability.

Section	Details
Construction	Candle 1: A large bearish candle continuing the downtrend. Candle 2: A small real-bodied candle showing hesitation. Candle 3: A bullish candle closing above the second candle’s close.
Forecast	A bullish reversal is likely if the third candle is strong and confirms buying interest.
Type of Pattern	Three-candle bullish reversal pattern.
Trend Prior to the Pattern	Forms during a prolonged downtrend.
Opposite Pattern	None directly.
Stop-Loss Placement	Below the low of the third candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Unique Three River Bottom Candlestick Pattern:

1. Identify a unique three river bottom during a downtrend.
2. Wait for the third candle to close above the second for confirmation.
3. Enter a buy trade at the close of the third candle.
4. Place a stop-loss below the low of the third candle.
5. Set a take-profit target at the next resistance or use a fixed reward ratio.

47. Three Stars in the South

Three stars in the south is a rare bullish reversal pattern that appears after a steep downtrend. It consists of three consecutive small-bodied bearish candles, each making lower lows but with diminishing range and weakening momentum. The pattern shows gradual exhaustion among sellers, setting up for a potential reversal.

Section	Details
Construction	Candles 1–3: Consecutive small bearish candles with declining range and lower shadows.
Forecast	Reversal is possible if a strong bullish candle follows.
Type of Pattern	Three-candle bullish reversal pattern.
Trend Prior to the Pattern	Forms after a rapid downtrend.
Opposite Pattern	Three Black Crows.
Stop-Loss Placement	Below the low of the third candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Three Stars in the South Candlestick Pattern:

1. Identify the three stars in the south during a steep decline.
2. Wait for a bullish candle to close above the third candle.
3. Enter a buy trade at the close of the confirmation candle.
4. Place a stop-loss below the lowest candle in the pattern.
5. Set a take-profit at the next resistance or use trailing stops for trend trades.

48. Advanced Block

The advanced block is a bearish reversal pattern that appears near the end of an uptrend. It consists of three consecutive bullish candles, each making higher highs but showing weakening momentum. The second and third candles often have long upper shadows and smaller bodies, which suggests buyer fatigue and the potential for a trend reversal.

The pattern closely resembles the three white soldiers, but the key difference is the loss of strength in each candle. Traders use this setup as a caution signal that an uptrend may be ending, especially if it forms near resistance or when accompanied by bearish divergence on RSI or MACD.

Section	Details
Construction	Candle 1: A full-bodied bullish candle. Candle 2: A bullish candle with a smaller body and upper shadow. Candle 3: A third bullish candle, smaller still, with another upper shadow.
Forecast	A potential bearish reversal if confirmed by a fourth bearish candle.
Type of Pattern	Three-candle bearish reversal pattern.
Trend Prior to the Pattern	Appears after a steady or extended uptrend.
Opposite Pattern	Three White Soldiers.
Stop-Loss Placement	Above the high of the third candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Advanced Block Candlestick Pattern:

1. Spot an advanced block pattern near a resistance level.
2. Wait for a bearish candle to close below the third candle’s low.
3. Enter a sell trade at the close of the confirmation candle.
4. Place a stop-loss above the high of the third candle.
5. Set a take-profit target at the next support zone.

49. Deliberation

The deliberation pattern is a bearish reversal formation made up of three bullish candles, similar in structure to the three white soldiers. The main difference is in the loss of momentum seen in the third candle. The first two candles are strong and show continued buying interest, but the third candle is noticeably smaller, often with an upper wick, showing hesitation or resistance.

The pattern suggests that although buyers are still present, they are beginning to run into selling pressure. It serves as a warning that the uptrend may be losing strength. A bearish confirmation candle following the deliberation pattern helps validate the shift in momentum.

Section	Details
Construction	Candle 1: A strong bullish candle. Candle 2: Another bullish candle closing higher. Candle 3: A smaller bullish candle with signs of hesitation (small body or upper wick).
Forecast	A potential bearish reversal if followed by a bearish confirmation candle.
Type of Pattern	Three-candle bearish reversal pattern.
Trend Prior to the Pattern	Forms during an uptrend.
Opposite Pattern	Three White Soldiers.
Stop-Loss Placement	Above the high of the third candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Deliberation Candlestick Pattern:

1. Identify a deliberation pattern forming after a steady rise.
2. Wait for a bearish candle closing below the third candle’s low.
3. Enter a sell trade at the close of the confirmation candle.
4. Set a stop-loss above the high of the third candle.
5. Place a take-profit at the next support level.

50. Identical Three Crows

Identical three crows is a strong bearish reversal pattern that forms at the end of an uptrend. It consists of three consecutive bearish candles that each open at or near the close of the previous candle, and all close lower. This structure indicates persistent selling pressure and little to no bullish retracement between sessions.

Unlike the standard three black crows, the identical opens reinforce the idea that sellers are in control and buyers are retreating entirely. It’s considered a reliable pattern when there is high volume or after an overbought signal.

Section	Details
Construction	Candle 1: A full-bodied bearish candle. Candle 2: Another bearish candle that opens near Candle 1’s close and closes lower. Candle 3: A third bearish candle, also opening near the prior close and closing lower.
Forecast	A strong bearish trend reversal is expected.
Type of Pattern	Three-candle bearish reversal pattern.
Trend Prior to the Pattern	Appears at the top of an uptrend.
Opposite Pattern	Three White Soldiers.
Stop-Loss Placement	Above the high of the first or third candle.
Candlestick Success Rate In Accuracity:	N/A

How Set Up a Trade with The Identical Three Crows Candlestick Pattern:

1. Spot an identical three crows pattern after a strong uptrend.
2. Wait for a fourth candle confirming the move lower.
3. Enter a sell trade at the close of the confirmation candle.
4. Set a stop-loss above the highest candle in the pattern.
5. Use a take-profit target at the next support.

What Are Candlestick Patterns? 

Candlestick patterns graphically display daily price movement information on a chart. They display the details of an asset’s price movement and can predict the future price direction.

Candlestick charting originated in Japan in the 18th century. It was developed by Munehisa Homma, a rice trader from Sakata, who used this method to analyze rice market trends. His techniques laid the foundation for modern candlestick patterns, which were later popularized in the Western world by Steve Nison in the 1990s.

Candlestick patterns generally represent one full day of price movement, so there are often approximately 20 trading days with 20 candlestick patterns in one month. 

Candlestick charts are a major component of a candlestick pattern. They present the price movements of derivatives, securities, and currencies as patterns. It is a crucial aspect of technical analysis and is used to interpret price information quickly from just a few price bars. 

The candlestick details a single trading on a daily chart. Below are its three basic features: 

• The body represents the open-to-close-range.
• The wick (the shadow) shows the intra-day, high or low.
• The color shows the direction of the price movement- a green (or white body) shows a price increase, while a red (or black body) shows that the price has reduced. 

Candlesticks create patterns that help traders identify significant support or resistance levels over some time. Many candlestick patterns show opportunities within the market. For example, while some give insights into the balance between buying and selling pressures, others pinpoint continuation patterns.

What Is The Relevance and Accuracy of Candlestick Patterns?

Different market factors, including the circumstances surrounding a trade, influence the relevance and accuracy of candlestick patterns. In most cases, candlestick patterns need to be more accurate for many traders to depend on. Therefore, they combine candlestick patterns with other risk management techniques to increase accuracy.

Below are specific factors that could influence the accuracy of candlesticks:

• Timeframe: The more prolonged the period is, the better the accuracy.
• Pattern and signal size: Large patterns often provide better signal accuracy.
• Security: Candlesticks work differently for forex, crypto, stocks, futures, and options. For example, some candlesticks work better for large-cap liquid stocks. 
• Overall pattern: The environment surrounding perceived signals can influence the accuracy. Traders can study the environment to identify why a signal occurred or did not occur. 
• Number of candles: The number of candles involved in a pattern can determine its accuracy. Usually, the more candles, the higher the accuracy. 

Candlestick charts consist of various information based on the high, low, open, and close for the timeframe a trader selects. Taking time to review the market context carefully can help increase the accuracy of candlesticks.

What Are The Best Books To Learn Candlestick Patterns?

Several books consistently stand out as reliable sources for learning candlestick patterns, both for beginners and experienced traders. These books offer practical insights, clean chart examples, and well-researched explanations that don’t rely on outdated theories or vague interpretations.

• Japanese Candlestick Charting Techniques by Steve Nison: This is the most referenced book on the subject and widely credited with introducing candlestick patterns to the Western trading community. It covers individual patterns, combinations, historical context, and how they integrate with Western technical tools. The explanations are clear, and the examples are based on real-world charts.
• Encyclopedia of Candlestick Charts by Thomas Bulkowski: Bulkowski’s book is extremely detailed and goes beyond definitions. He includes statistical performance analysis for each pattern, something many other resources leave out. It’s a reference guide, best used to verify how often patterns work based on historical data.
• The Candlestick Course by Steve Nison: This book is a practical extension of the author’s original book. It includes quizzes, chart exercises, and examples geared toward application. It’s useful if you prefer structured learning with reinforcement tools.
• Beyond Candlesticks by Steve Nison: This one is slightly more advanced. It covers lesser-known Japanese charting techniques like Renko and Kagi, and goes into more subtle candlestick variations. It’s useful for traders looking to go beyond basic pattern recognition.
• Technical Analysis of the Financial Markets by John J. Murphy: This book is not focused mainly on candlesticks, it includes a strong section on them and shows how they fit into broader technical strategies. It’s valuable if you want to place candlestick patterns in context with trend analysis, volume, and indicators.

Can You Use Candlestick Patterns In Each Timeframe?

Yes, candlestick patterns can be used across all timeframes. The visual structure of the pattern remains the same regardless of whether you’re looking at a 1-minute chart or a monthly chart. What changes is how much information each candle represents and how that fits into your overall strategy.

The timeframe doesn’t change the nature of the pattern, but it does affect how reliable and actionable it is. A bullish engulfing candle on a 15-minute chart might only reflect temporary momentum, while the same pattern on a daily chart may suggest a full shift in trend. 

Traders use patterns on one timeframe while checking higher ones to confirm the broader direction. This multi-timeframe approach helps filter out weak signals and can give a clearer view of market context.

Which Timeframe is the best for Candlestick Patterns?

There’s no single “best” timeframe for candlestick patterns that applies to every trader, it depends entirely on your trading style and strategy you are trying to implement. That said, daily charts are widely considered the most reliable timeframe for spotting and trading candlestick patterns.

Daily Timeframe

Patterns that form on daily charts carry more weight because each candle reflects a full trading session. This timeframe filters out intraday noise and shows clearer setups that are more likely to result in meaningful moves. Many swing traders and even institutional participants rely on daily candlestick signals when planning entries and exits. Most of the classic patterns like engulfing candles, hammers, and evening stars tend to perform more consistently here.

4-Hour and 1-Hour Charts

These timeframes are popular among short-term traders who want more opportunities without sacrificing too much signal quality. Patterns that form on these charts are less susceptible to fake-outs than those on 5- or 15-minute charts. They’re useful when aligned with the broader trend on higher timeframes like the daily chart.

Weekly Charts

Long-term investors or position traders will find weekly candlestick patterns are highly reliable. A single candle covers five trading days, and any setup that forms here reflects a much larger group of traders taking action. Patterns on weekly charts are less frequent but more significant when they appear.

Short Charts: 1-minute or 5-minute

Avoid relying on very low timeframes like 1-minute or 5-minute unless you’re scalping with a clear strategy. Patterns on these charts can look technically valid but fail quickly due to random price spikes, spreads, and slippage.

What Are The Limitations Of Candlestick Patterns?

Candlestick patterns are great for predicting future price movements, but they’re not foolproof. Traders who use them without understanding their limitations often end up misreading signals or forcing trades that aren’t there. Here’s what you need to keep in mind:

They Need Context to Work

A candlestick pattern means very little on its own. Without knowing where it’s forming – near support, resistance, trendlines, or key zones – it’s just a random arrangement of candles. The same pattern can mean two very different things depending on the surrounding structure.

Patterns Can Be Too Open to Interpretation

Not every engulfing candle is clear-cut. Some traders count partial overlaps; others don’t. What looks like a valid morning star to one person might look like nothing special to someone else. This subjectivity makes candlestick trading inconsistent if you don’t define your own rules.

They’re Often Late to the Move

Candlesticks react to what’s already happened. A reversal pattern like a hammer appears after price has dropped. That’s helpful for timing, but it means you’re always entering after the initial shift, not ahead of it.

They Don’t Explain Why Price Moved

Candles show what happened but not why. A bearish engulfing candle might signal strong selling, but if there’s no fundamental reason behind it, the move could be short-lived. This is where combining price action with market context like news, volume, and sentiment becomes important.

Low Timeframes Create More Noise

On charts like the 1-minute or 5-minute, candlestick patterns form constantly but most of them are unreliable. There’s too much random price movement, and patterns can be triggered by one big order or a quick news headline. The lower the timeframe, the more false signals you’ll run into.

They Don’t Predict Future Movement Alone

Patterns like evening stars or three white soldiers don’t guarantee price movement. They suggest what might happen, but the price can easily go the other way. Using patterns without confirmation is one of the fastest ways to get caught in fakeouts.

They Can Fail Without Warning

Even when a pattern forms perfectly and meets all the textbook conditions, it can still fail. No pattern has a 100% success rate. That’s why risk management and trade confirmation are required for long term trading success.

How High Is The Hit-Rate Of Candlestick Patterns?

The hit-rate of candlestick patterns varies depending on the specific pattern, the market conditions, and the timeframe it’s used on. Most patterns have an average success rate of 66%, but some perform better under certain conditions. For example, a bullish engulfing pattern forming near strong support with high volume will likely outperform the same setup forming in the middle of a sideways range.

It’s important to understand that candlestick patterns don’t guarantee outcomes, they highlight potential next market moves. Even the most reliable patterns fail regularly, which is why they’re best used as entry signals within a structured trading plan like WR Trading, not standalone systems. Traders who track their setups with confirmation tools, proper risk management, and attention to market context tend to see better results than those relying on patterns alone.

Difference Between Candlestick Patterns and Chart Formations

Candlestick patterns and chart formations are used in technical analysis to interpret market behavior. Yet,  they differ in their scope and application. Candlestick patterns focus on individual price bars, typically representing one trading session, and provide insights into market sentiment within that period, such as potential reversals or continuations. 

Conversely, chart formations consist of broader patterns formed by multiple price bars over an extended period, offering insights into the trend and potential future price movements.

These formations often require a longer-term perspective and provide signals related to trend continuation or reversal on a larger scale. Hence, while candlestick patterns and chart formations contribute to comprehensive technical analysis, they operate differently. 

Pros and Cons of Candlestick Trading Patterns

Below are the advantages and downsides of candlestick trading patterns: 

Candlestick patterns give traders a quick and clear picture of how the market is moving. They show traders important points like when prices opened, closed, went high, and went low. 

However, although they are valuable for understanding market trends and momentum, we recommend not getting overwhelmed by too many details. 

How To Trade Candlestick Patterns?

Trading candlestick patterns doesn’t have to be complicated if you approach it systematically. Here’s a practical, six-step method that’s clear, detailed, and beginner-friendly:

Identify a Valid Candlestick Pattern

Start by examining your charts carefully for common candlestick patterns such as the Hammer, Shooting Star, Engulfing, or Morning Star. Ensure the pattern is clearly visible and occurs at significant price levels, like strong support or resistance areas. Patterns that occur at these key market levels often lead to stronger, more reliable signals.

Confirm the Pattern with the Next Candle

Never enter a trade solely based on the appearance of a candlestick pattern. Always wait for the next candle to provide confirmation. For example, after a bullish Hammer appears at support, wait for a strong green candle to close clearly above the Hammer’s high. This step significantly reduces the chance of entering a false signal.

Conduct Simple Technical Analysis

After confirming the candlestick pattern, do a quick yet thorough analysis using other basic tools and indicators to support your decision. Check if moving averages, trendlines, or indicators like RSI or MACD align with your pattern. If the pattern matches the broader technical context – for example, a bullish candlestick pattern occurs near an upward-trending moving average – the trade becomes even more reliable.

Enter the Trade at a Smart Price Level

Once your pattern is confirmed and supported by your analysis, enter the trade at the closing price of the confirmation candle. This entry approach prevents you from entering too late or chasing the market after the price has already moved significantly.

Set Clear Stop-Loss and Take-Profit Targets

Immediately set your stop-loss order to protect yourself. Place your stop-loss slightly below the lowest wick of a bullish pattern or slightly above the highest wick of a bearish pattern. Setting clear profit targets is equally important. Use logical levels such as previous highs, lows, support, or resistance. Aim for trades with a favorable risk-to-reward ratio, ideally at least twice your potential risk.

Manage Your Trade and Reflect on Results

Stay actively involved in your open trades by adjusting your stop-loss to lock in profits as the price moves in your favor. Don’t move stops closer if the trade moves slightly against you; stick to your original plan. 

Once the trade concludes, review it in detail – note what worked well and where you could improve. Learning from each trade will steadily make you a more skilled, consistent, and profitable trader.

How To Find Candlestick Patterns in the Chart?

Recognizing candlestick patterns accurately on your charts is a valuable skill that enhances your trading performance. To help you master this, here’s a clear, practical six-step approach that anyone can follow:

Choose the Right Chart and Timeframe

Begin by selecting a clear, easy-to-read candlestick chart from your preferred trading platform. Your chosen timeframe significantly influences pattern clarity. Daily charts often offer reliable signals due to less noise, making it easier to spot patterns clearly. Shorter timeframes like hourly or 15-minute charts can also be useful but may require extra confirmation to avoid false signals.

Zoom Out and Understand the Context

Before you start identifying patterns, zoom out slightly to get a broader perspective of the current trend and price action. Clearly define whether the market is trending upwards, downwards, or moving sideways. Patterns appearing at key levels, such as major support or resistance zones, are more likely to produce stronger and more reliable trading signals.

Clearly Identify the Individual Candles

Carefully examine the recent candles one by one, noting the key price points – open, high, low, and close. Look specifically for candles with distinct characteristics, such as long wicks (which indicate strong rejection of price levels) or large bodies (which suggest strong buying or selling pressure). Understanding these individual candle characteristics sets the foundation for accurate pattern recognition.

Look for Recognizable Patterns

Once you’re familiar with individual candles, actively look for established candlestick patterns, including Engulfing, Hammers, Dojis, Morning Stars, and Evening Stars. Remember, patterns can consist of one, two, or several candles. Scan through the chart carefully and consistently to ensure you don’t overlook critical signals.

Confirm the Pattern Through Subsequent Price Action

Finding a candlestick pattern alone isn’t enough. Always verify the pattern through subsequent candles. For example, a Hammer at the bottom of a downtrend should ideally be followed by a bullish candle closing above the Hammer’s high to confirm that buyers are indeed entering the market. Waiting for this confirmation significantly improves the accuracy of your findings.

Validate Patterns with Additional Indicators

After identifying and confirming the candlestick pattern, cross-check it with other simple indicators or technical tools like moving averages, support/resistance levels, RSI, or volume indicators. If multiple indicators align and support the candlestick pattern you’ve found, it enhances confidence in your analysis, leading to stronger, higher-probability trades.

Which Different Types Of Candlestick Patterns Exist?

Candlestick patterns are clearly divided into 4 main types (categories) based on the market behavior they represent (Reversal/Bearish, Continuation, Consolidation, Bullish). Understanding these candlestick pattern types helps you quickly identify market conditions and improve your trading decisions.

See in this table below the 50 different Candlestick Patterns and their categorisation:

Number	Candlestick Pattern	Signal	Description
1	Hammer	Bullish Reversal	A small-bodied candle with a long lower wick, showing rejection of lower prices.
2	Shooting Star	Bearish Reversal	A small-bodied candle with a long upper wick, rejecting higher price levels.
3	Bullish Engulfing	Reversal	One candle fully engulfs the previous candle’s body, signaling a shift in direction.
4	Morning Star	Bullish Reversal	Three candles: bearish, indecision, then bullish – indicating trend reversal.
5	Evening Star	Bearish Reversal	Three candles: bullish, indecision, then bearish – signaling a trend top.
6	Harami	Reversal	A smaller candle forms within the previous candle’s range, showing hesitation.
7	Hanging Man	Bearish Reversal	A small body with a long lower wick appearing after an uptrend.
8	Doji	Indecision/Neutral	A candle with little to no body, showing balance between buyers and sellers.
9	Pin Bar	Reversal	A long wick and small body indicating price rejection and potential reversal.
10	Bullish Mat Hold	Bullish Continuation	A five-candle formation where a brief pause is followed by trend continuation.
11	Gap Up / Gap Down	Momentum – Reversal / Continuation	A price gap between candles often signals strong momentum.
12	Tri Star	Reversal	Three consecutive Doji candles suggesting extreme market indecision.
13	Tweezer Top / Bottom	Reversal	Two candles with matching highs or lows at turning points.
14	Belt Hold	Reversal	A strong single candle with no wick on one side, showing firm direction.
15	Abandoned Baby	Reversal	A Doji gapped between two opposite candles, marking sudden reversal.
16	Kicker	Reversal	A sharp directional shift with a gap open opposite the prior trend.
17	Three Outside Up / Down	Reversal	Engulfing candle followed by a third confirming the new direction.
18	Three Inside Up / Down	Reversal	Harami confirmed by a third candle in the direction of the reversal.
19	Piercing Line	Bullish Reversal	Bullish candle closes above the midpoint of the prior bearish candle.
20	Dark Cloud Cover	Bearish Reversal	Bearish candle closes below midpoint of prior bullish candle.
21	Three Black Crows	Bearish Reversal	Three large red candles in a row after an uptrend.
22	Rising Three Methods	Bullish Continuation	A bullish candle, small pullback candles, and then another bullish candle.
23	Falling Three Methods	Bearish Continuation	A bearish candle, small upward candles, then a continuation downward.
24	Tasuki Gap	Continuation	Gapped candles followed by a pullback that does not fill the gap.
25	Inside Bar	Neutral / Breakout	A candle entirely within the prior candle’s range, showing contraction.
26	Outside Bar	Reversal / Breakout	A large candle engulfs the prior candle’s range, showing strength.
27	Spinning Top	Indecision	A small body with long upper and lower wicks, reflecting uncertainty.
28	Popgun	Breakout Setup	An inside bar followed by an outside bar, anticipating a breakout.
29	Shaven Head	Bullish Continuation	Bullish candle with no upper wick, showing strength to the close.
30	Shaven Bottom	Bearish Continuation	Bearish candle with no lower wick, showing strong selling.
31	High Wave Candlestick Pattern	Indecision	A small real body with long wicks, reflecting market instability.
32	Separating Lines	Continuation	Opposite color candles with the second opening at the first’s open.
33	On Neck	Bearish Continuation	Bullish candle closes at or near prior candle’s low, showing failure to recover.
34	In Neck	Bearish Continuation	Bullish candle closes slightly above the previous bearish close.
35	Breakaway	Reversal	Five candles showing a loss of momentum followed by a trend change.
36	Concealing Baby Swallow	Bearish Continuation	Bearish candles where the last engulfs a small-bodied one.
37	Homing Pigeon	Bullish Reversal	Two bearish candles with the second within the first’s body.
38	Ladder Bottom	Bullish Reversal	Three bearish candles, then a doji and a bullish candle.
39	Ladder Top	Bearish Reversal	Three bullish candles, then a doji and a bearish candle.
40	Matching High	Bearish Reversal	Two bullish candles closing at the same level near resistance.
41	Matching Low	Bullish Reversal	Two bearish candles closing at the same level near support.
42	Meeting Lines	Reversal	Two opposite candles that close at the same price.
43	Bullish Side by Side White Lines	Bullish Continuation	Two bullish candles with similar size and structure after a gap.
44	Bullish Stick Sandwich	Bullish Reversal	Bullish candle sandwiched between two bearish candles with matching closes.
45	Three Line Strike	Continuation	Three candles in trend direction followed by a large opposite candle.
46	Unique Three River Bottom	Bullish Reversal	Bearish candle, indecision, then bullish confirmation.
47	Three Stars in the South	Bullish Reversal	Three small bearish candles with decreasing range.
48	Advanced Block	Bearish Reversal	Three rising candles losing strength, suggesting exhaustion.
49	Deliberation	Bearish Reversal	Three bullish candles with weakening momentum.
50	Identical Three Crows	Bearish Reversal	Three bearish candles with nearly identical opens and lower closes.

1. Reversal Candlestick Patterns

Reversal candlestick patterns indicate a possible shift in market direction. They appear at key turning points, signaling the end of an existing trend – either from bullish to bearish or vice versa. Common reversal patterns include the Hammer, Shooting Star, Engulfing Pattern, Morning Star, and Evening Star. Traders pay close attention to reversal patterns at significant price areas like major support or resistance, as these typically provide the strongest and most reliable signals.

2. Continuation Candlestick Patterns

Continuation candlestick patterns show that the current trend is likely to keep going after a brief pause or consolidation. These patterns signal a temporary rest period before the market resumes its original direction. Identifying these patterns within a clear trend can help traders confidently stay with the current momentum and ride the trend further.

3. Consolidation Candlestick Patterns

Consolidation or indecision candlestick patterns form when neither buyers or sellers are clearly in control, resulting in sideways price movements. Patterns like the Doji, Inside Bar, Spinning Top, or High Wave candle fall into this category. Consolidation patterns highlight periods of uncertainty and usually lead to breakouts, either continuing the existing trend or starting a new direction altogether. Always wait for a clear breakout from these patterns before entering trades to reduce the risk of false signals.

4. Bullish Candlestick Patterns

Bullish candlestick patterns suggest that buyers are gaining control and prices may rise. These patterns often form after a decline or during consolidation, signaling the potential start or continuation of an upward move. 

Common bullish patterns include the Hammer, Bullish Engulfing, Morning Star, Piercing Line, and Three White Soldiers. These setups become more reliable when they appear near support zones, trendlines, or Fibonacci levels. Bullish patterns reflect a shift in market sentiment, where buying pressure overcomes selling pressure. 

5. Bearish Candlestick Patterns

Bearish candlestick patterns indicate that selling pressure may soon outweigh buying interest, often forming at the end of an uptrend or after a brief pause in bullish momentum. These patterns suggest a bearish reversal and are used by traders to anticipate selloffs. Examples include the Shooting Star, Bearish Engulfing, Evening Star, and Three Black Crows. Bearish patterns become more reliable near resistance zones or after overextended price runs when confirmed by a strong close in the following session. They are great for timing exits or short entries.

What Are the Worst Candlestick Patterns?

Due to their practicality and low sucess rate, these 3 candlestick patterns are seen as the least reliable:

• Rising Window / Falling Window
• Tri Star
• Mat Hold

Not every candlestick pattern offers a high-probability trading signal. Some are vague, hard to spot in real-time, or just don’t deliver consistent follow-through. These patterns may appear impressive in theory but lack practicality when it comes to real-world chart setups. 

Here are three candlestick patterns that are considered the worst, not because they’re completely useless, but because they tend to be inconsistent, misleading, or too rare to rely on as a primary signal.

Rising Window / Falling Window

These are continuation patterns that rely on gaps between candles. The problem is they’re hard to spot on many charts – forex, crypto, and most CFD brokers don’t display gaps clearly due to continuous trading. Even when they do appear, there’s no standard rule for how wide the gap must be or how to confirm the continuation. 

Tri Star

The Tri Star is one of the rarest candlestick patterns you’ll ever see when trading. It requires three doji candles in a row, which rarely happens with clean symmetry unless you’re specifically looking for them. Even when it does form, it’s hard to confirm, and the market often continues sideways, making it more of a statistical fluke than a reliable setup.

Mat Hold

This five-candle bullish continuation pattern looks great in textbooks but is difficult to trade in real conditions. You need a perfect sequence of candles: one strong bullish, followed by a tight consolidation, and then a breakout, all with precise candle ranges. Because of how specific this setup is, you’ll almost never see it form cleanly, and even when you do, it’s usually too late to catch a decent risk-to-reward setup.

Can Candlestick Patterns Be Used In All Types of Markets?

Yes, candlestick patterns aren’t limited to one market – they’re versatile and widely used because they represent human psychology and market sentiment. Traders across various markets and assets, from cryptocurrencies and stocks to forex and commodities, rely on these patterns to understand and predict price movements. Here’s how they apply to different markets:

Crypto

Crypto markets are known for their volatility and fast price changes. This means candlestick patterns often show up very clearly, offering quick insights into shifts between buyers and sellers. 

In crypto, traders rely heavily on short-term patterns to spot potential reversals or momentum changes early. Given the speed at which crypto prices move, it’s useful to combine candlestick patterns with volume or simple technical indicators like RSI to confirm signals.

Forex

Forex markets run around the clock during weekdays, resulting in a lot of clear, consistent price patterns. Because currencies are directly influenced by global economic events and news, candlestick patterns often highlight important moments of market indecision or strong shifts in sentiment. Forex traders pair candlestick patterns with fundamental data releases or economic news calendars to strengthen their analysis, providing both technical and fundamental context.

Stocks

In stock trading, candlestick patterns can be useful around earnings reports or major corporate announcements, as these events often trigger strong emotional responses from investors. Stock traders use candlestick patterns to identify shifts in market sentiment, helping them anticipate where price might move next. Patterns tend to hold more significance when they’re formed at critical levels like key support, resistance, or alongside notable changes in trading volume.

Futures

Futures contracts cover commodities, indices, and more – each heavily influenced by supply and demand factors. Because these markets often have high liquidity and clear price movements, candlestick patterns regularly offer straightforward signals about possible price direction.

Futures traders trust patterns formed after significant price moves, looking for signs of reversals or continuation. Checking patterns against market fundamentals, such as inventory reports for commodities, can add extra reliability.

Options

Timing and price direction matter significantly for options traders. Candlestick patterns help options traders make more precise predictions about potential market direction or volatility changes. Identifying a bullish or bearish candlestick pattern in the underlying asset can be useful in deciding whether to buy call or put options. Combining patterns with implied volatility data or simple volatility indicators enhances their effectiveness in the options market.

CFDs

CFD traders focus on short-term price movements across various assets like indices, forex, commodities, or individual stocks. Because CFDs involve leveraged trades, accuracy and timing are critical. 

Candlestick patterns help CFD traders quickly spot turning points or continued trends. When used together with basic technical tools such as moving averages, support/resistance levels, or momentum indicators, candlestick patterns become even more practical and reliable for trading CFDs effectively.

Why Do Candlestick Patterns Matter In The Market?

Candlestick patterns matter in trading because they’re one of the clearest ways to visualize the collective psychology and behavior of traders. When a well-known candlestick pattern forms on a chart, thousands of traders notice and react simultaneously, often leading to predictable price movements. Essentially, the more traders who see and respond to the same signal, the stronger and more reliable that signal becomes in influencing price direction.

Moreover, candlestick patterns simplify market analysis, making it easier for traders to quickly grasp market sentiment without needing complex indicators or advanced analysis. They provide immediate visual cues about potential shifts in buying or selling pressure, helping traders anticipate where prices might head next. Because these patterns are universally recognized, from institutional investors to retail traders, they remain consistently effective across all markets and timeframes.

Mastering Candlestick Trading with WR Trading Mentoring 

At WR Trading Mentoring Academy, many new traders have enjoyed the expertise of professional traders since 2012. They gain access to comprehensive resources tailored to candlestick trading. The academy offers tutorials covering market techniques, analysis methods, and risk management strategies.

It also emphasizes practical application and community support. So, by mastering candlestick trading with WR Trading Mentoring Academy, traders become equipped with the knowledge and tools they need to succeed.

Frequently asked questions on Candlestick Patterns: