$WCT
How to evaluate candle sticks while trading in crypto?
Evaluating candlestick patterns is essential for understanding crypto price movements and making informed trades. Each candlestick shows four key data points: open, high, low, and close within a specific time frame.
Bullish candles (usually green) close higher than they open; bearish candles (red) close lower.
Doji candles indicate indecision—prices open and close nearly at the same level.
Hammer and Inverted Hammer suggest potential reversals after a downtrend.
Engulfing patterns signal trend reversals: a bullish engulfing shows strong buying pressure, while bearish engulfing warns of a downtrend.
Shooting Star and Hanging Man are warning signs of possible trend changes.
Look for patterns in context—volume, support/resistance levels, and trend direction matter. A single candle isn’t enough; assess formations like three white soldiers or evening stars for stronger signals.
Practice with historical charts and combine candlestick analysis with indicators like RSI or MACD for better accuracy.