๐จ Learn These Key Chart Patterns to Sharpen Your Trading Skills & Avoid Costly Mistakes! ๐๐ฅ
Mastering candlestick patterns can give you a serious edge in the markets. Here are the essentials every trader should know:
๐ข Bullish Reversal Patterns โ Signaling Potential Uptrends:
Bullish Engulfing โ A strong green candle fully covers the prior red one, showing powerful buying pressure.
Bullish Tweezers โ Identical or near-identical lows on two candles, often pointing to solid support and an upcoming bounce.
Morning Star โ A three-candle setup that hints at selling exhaustion and a shift toward buying momentum.
Hammer โ A small candle with a long lower wick, showing buyers stepped in after sellers pushed price down.
Inverted Hammer โ Appears at the bottom of a downtrend, with a long upper wick and bullish potential.
Three Inside Up โ Begins with a red candle, followed by two green candles confirming the bullish move.
Three White Soldiers โ Three strong green candles in a row, each closing higher than the lastโpure bullish energy.
๐ด Bearish Reversal Patterns โ Warning of Potential Downturns:
8. Bearish Engulfing โ A dominant red candle overtakes the prior green one, signaling heavy selling.
9. Bearish Tweezers โ Similar highs on back-to-back candles, pointing to strong resistance.
10. Evening Star โ A three-candle formation indicating a shift from buying to selling pressure.
11. Shooting Star โ A small body with a long top wickโbuyers lost steam, and sellers stepped in.
12. Three Black Crows โ Three straight red candles, each closing lower, often signals strong downward momentum.
13. Three Inside Down โ Starts with a green candle, followed by two red ones confirming the reversal.
โช Neutral / Indecision Patterns โ Time to Wait and Watch:
14. Spinning Tops โ Small-bodied candles with long wicks on both endsโmarket is undecided.
15. Doji โ Open and close are nearly identical, showing hesitation and a possible change in direction.
Recognizing these candlestick patterns can help you read the market more effectively and make smarter trading decisions.
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