Here are 5 essential candlestick patterns that beginners should learn to start understanding price action and market psychology:

1. Doji

What it means: Indecision in the market; buyers and sellers are in balance.

Appearance: Very small or no real body, with wicks on both sides.

Signal: Can indicate a potential reversal if found after a strong trend.

2. Hammer

What it means: A potential bullish reversal after a downtrend.

Appearance: Small body at the top, long lower wick (at least 2x the body), little to no upper wick.

Signal: Buyers pushed the price up after a strong sell-off.

3. Shooting Star

What it means: A potential bearish reversal after an uptrend.

Appearance: Small body at the bottom, long upper wick (at least 2x the body), little to no lower wick.

Signal: Sellers started to overpower buyers after a price surge.

4. Bullish Engulfing

What it means: A strong bullish reversal signal.

Appearance: A small red candle followed by a larger green candle that completely engulfs the previous candle's body.

Signal: Buyers have taken control after a downtrend.

5. Bearish Engulfing

What it means: A strong bearish reversal signal.

Appearance: A small green candle followed by a larger red candle that completely engulfs the previous candle's body.

Signal: Sellers have taken control after an uptrend.