📌 Hammer
The Hammer is a bullish reversal pattern, typically appearing at the bottom of a downtrend. It features a small body and a long lower wick, indicating that sellers drove the price down, but buyers regained control by the close. It's a symbol of resilience and a potential turning point.
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📌 Inverted Hammer
Also appears after a downtrend, characterized by a small body and a long upper wick. While reflecting early buyers' attempts to push the price up, its true potential lies in the confirmation that follows. It indicates the possibility of a bullish reversal.
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📌 Doji Dragonfly
This unique pattern forms when the opening, high, and closing prices are almost identical, but the session has a long lower shadow. This indicates strong buying pressure after a decline and can be a strong signal for a trend reversal if confirmed by subsequent candles.
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📌 Bullish Ascending Top
The bullish spinning top pattern shows market indecision, characterized by a small body and shadows on both sides. Despite price fluctuations during the session, neither bulls nor bears gained full control. When seen after a downtrend, it can be an indicator of upward movement.
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📌 Hanging Man
The Hanging Man is a bearish signal, often found at the top of an uptrend. With a small body and a long lower shadow, it indicates increasing selling pressure - even if the price closes higher. It serves as a warning that the trend may be losing momentum.
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📌 Shooting Star
The Shooting Star is a classic sign of a bearish reversal, characterized by a small body near the session's low with a long upper shadow. It appears after an uptrend, showing that buyers attempted to push prices higher but failed to maintain momentum, allowing bears to take over.
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📌 Doji Gravestone
This Doji Gravestone resembles the bullish variant, with a long upper shadow and a negligible or nonexistent lower shadow. It indicates rejection of higher prices and the potential for a trend reversal, especially at market tops. Traders closely watch this pattern for signs of waning optimism.
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📌 Bearish Spinning Top
Similar to its bullish counterpart, the bearish spinning top reflects market indecision - but when seen after a rally, it indicates weakness in upward momentum. The tug of war between buyers and sellers may lead to a downward shift.
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🎯 Summary
Single candle patterns are small but effective tools in technical analysis. They may seem simple, but they provide deep insights into market sentiment and potential price direction. When combined with trading volume, support/resistance levels, and confirmation candles, these patterns significantly enhance a trader's decision-making ability.
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