#CryptoCharts101
📊 Japanese Candlesticks: The Key to Understanding the Market!
Candlestick Analysis is a classic of trading that helps you recognize market sentiment and predict price movements. 📈 Let's look at the most popular candlestick patterns that will help you trade!
🔄 Reversal Patterns
1️⃣ Absorption
• A clear trend precedes.
• The body of the second candlestick completely “absorbs” the first.
• The colors of the candles are opposite. 💪 Stronger signal: the second candlestick absorbs both shadows, and the first one is much smaller.
2️⃣ Hammer and Hanged Man
• Small body, long lower shadow (2-3 times the body).
• The upper shadow is absent or minimal. 💡 Reinforcement: long shadow, strong trend, small body.
3️⃣ Inverted Hammer and Shooting Star
• Signal a reversal: an inverted hammer is at the bottom, a shooting star is at the top.
• Often indicate the end of a correction.
4️⃣ Doji
• The forces of buyers and sellers are equal.
• Can signal both a reversal and a continuation. ⚠️ Wait for confirmation!
➡️ Trend continuation models
1️⃣ Windows (Gap)
• A price gap that confirms the strength of the trend.
2️⃣ Three methods
• One large candle + 3 small ones at the same level.
• Similar to a “flag” and indicates a continuation of the movement.
📝 How to use?
• Strong trend = strong signal.
• Patterns work best near key levels.
• Avoid signals if the pattern repeats often.
• Always combine with other analysis methods (technical, indicators).
⚠️ Remember: candles are not an entry point, but a signal about the market mood. Analyze, confirm, trade wisely! 🧠