Candlestick Patterns Explained with Examples

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6.

Bearish Counter Attack Line candlestick pattern

This pattern consists of two candlesticks. The first candlestick is white, the second black. The second candlestick opens sharply higher but closes unchanged from the prior session. When this occurs, it indicate s that buyers and sellers are at a standoff.

















7.

Bullish Counter Attack Line candlestick pattern

This pattern consists of two candlesticks. The first candlestick is black, the second white. The second candlestick opens sharply lower but closes unchanged from the prior session. When this occurs, it indicate s that buyers and sellers are at a standoff.



















8.

Breakaway Bear Candlestick pattern



















9.

Breakaway Bull Candlestick pattern



















10. Body Gap Down candlestick pattern





































12. Bullish Engulfing Line candlestick pattern



















































































































































































































28. InNeck Candlestick pattern This candlestick pattern consists of two candles. The first is long and black the second is a short white real body. The close o f the white candlestick is above the low of the black one. This pattern appears in downtrends. The white candlestick represents a brief pause where the bulls have stopped the downward trend but once the white candlestick low is broken the downtrend should resume.

















29. Inverted Hammer candlestick pattern This candlestick has a very small real body with a very long top shadow. There is little or no bottom shadow. When appearing after a long downtrend this candlestick indicates a possible trend reversal.

















30. Ladder Bottom Candlestick After an established downtrend, three black days with consecutively lower closes occur. The fourth day is a black day with an upper wick. An Inverted Hammer. The fifth day is a white day. The first several days establish a consistent downtrend. As time progresses however shorts take the opportunity to par-off their positions and take profit. This is illustrated in the fourth days black Inverted Hamme r candle. As prices are bid up, the high is pushed up. In this formation sellers are still able to drive price down to levels nearer the open creating a small body. Up to dayfour in the formation this just suggests that sellers are losing firm control of the market. By the fifth day, a bullish rally creates the long white candle. Candlestick analysts would look for buy entry opportunities to come.

















31. Long Legged Doji candlestick pattern This candlestick is a Doji with a long upper and lower shadow. It can be a sign of a market reversal.

















32. MatHold Pattern candlestick pattern This pattern consists of five candlesticks. The first is a long white real body followed by three small black bodies, and then a small white bo dy. The first black candlestick gaps up from the fi rst white candlestick. The three black bodies each close progressively lower. The last white candlestick gaps up from the black series. The impli cation is that the trend has not been stalled. The Mat Hold pattern is a stronger continuation pattern than the Rising Three Method.



















33. Meeting Lines Bear Day one is long white day. Day two is long black day. Both days close at the same price. After an uptrend, the second days candle open above the previous close. Even though the second day had rallie d during off-exchange hours and opened high, a sell-off brings the close near the previous day closed. Figuratively meeting the lines of close prices. This typically means the bull trend has been weakened and a re versal is possible.

















34. Meeting Lines Bull Meeting Lines Bull is a bulli sh market reversal pattern indicating the beginning of an uptrend after a downtrend. It is a two candlestick formation. The first day should be noticeable with strong bearish activity resulting in a long bearish candlestick. On second day there should be a bullish candlestick (often it is shorter than first day candlestick) which opens below a significant gap and closes at or around the closing price of first day candle.

















35. Morning Star candlestick pattern This pattern consists of three candlesticks. A long black body, a small white body that gaps down from the black body and finally a white candlestick which closes above the midpoint of the black candlestick.

















36. Morning Doji Star candlestick pattern This pattern consists of three candlesticks. This pattern is the same as the Morning Star except a Doji appears instead of a small white body.

















37. On Neck Candlestick First day we see a long black candle. The second day is white day, opening belo w the low of the fi rst day and closing barely into the body of the first day. Because the On Neck does not trade up to the previous day's close or into day one's candle, it serves as a strong bearish continuation signal.























































40. Rising Three Method candlestick pattern



















41. Separating Line Bearish candlestick pattern





































































































































































































































58. Tri Star Bear After an established bull trend, three do jis (open and close at identical price) occur on three consecutive trading days. After a long up-trending market the appearance of three do jis suggests a great deal of indecision about t he future direction of the market. Such signs of indecision often precede reversals. The first doji day reveals that the market is indecisive after a long uptrend. The second doji day further emphasizes market uncertainty, by the third doji day longs have cle arly lost momentum and complete control o f the market. Candlestick analysts will look for bearish moves in the following days.

















59. Tri Star Bull After an established downtrend. There dojis (open and close at identical price) occur o n consecutive trading days. In a long bearish market the strength of trend shows weakness as candle bodies grow progressively smaller, eventually f orming three consecutive dojis. A doji candle reveals market indecision, since neither buyers nor sellers prove able to move the close price away from the open. This kind of price action is quite common during periods with limited m arket activity like holidays. However, after a protracted downtrend or during periods of high trading volume a number of dojis can suggest a reversal in market trend.

















60. Tweezers Bottom In an established downtrend, day-one is a black candle with a shaven bottom. The second day is a white hammer or doji with a long upper shadow. The essential element of this pattern is a series of candles that all share the same low. This could be the two days in the examples below, or a number of days that are not consecutive. After a protracted bearish move, this may provide a weak reversal signal but most tra ders will look for additional confirmation of a reversal.

















61. Tweezers Top In an established uptrend day one i s a white candle with a shaven bottom. The second day is a black hammer o r doji with a long l ower shadow. The essential element of this pattern a series of candles that all share the same high. This could be the two days in the examples above, or a number of days that are non-consecutive. After a protracted bullish move this may provide a weak reversal signal, but most traders will look for additional confirmation of a reversal.

















62. Upside Gap Two Crows candlestick pattern This pattern consists of three candlesticks. The first is long and white, the second and third are small and black. The second small black body gaps up from the long white candlestick. The third body opens above the second open but then closes below the second's close. This is a top reversal pattern in advancing markets.



















63. Western Gap Down candlestick pattern A western gap down occurs when the current high is less than the previous low. This is the traditional definition of a gap down unlike the Japanese definition which only takes into account the body of the candlestick (relationship o f open and close) and not the highs and lows.

















64. Western Gap Up candlestick pattern A Western Gap Up occurs when the current low is greater than the previous high. This is the traditional definition of a gap up, unlike the Japanese definition which only takes i nto account the body of the candlestick (relationship o f open and close) and not the highs and lows.

Candlestick Patterns Explained with Examples

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