#CryptoCharts101 📊 Japanese Candles: The Key to Understanding the Market!

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Candle analysis is a classic trading technique that helps you recognize market sentiment and predict price movements. 📈 Let’s take a look at the most popular candle patterns that will help you trade!

🔄 Reversal Patterns

1️⃣ Engulfing

• Preceded by a clear trend.

• The body of the second candle completely "engulfs" the first.

• The colors of the candles are opposite. Stronger signal: the second candle engulfs both shadows, and the first is significantly smaller.

2️⃣ Hammer and Hanging Man

• Small body, long lower shadow (2-3 times longer than the body).

• Upper shadow is absent or minimal. 💡 Strengthening: long shadow, strong trend, small body.

3️⃣ Inverted Hammer and Shooting Star

• Reversal signal: inverted hammer at the bottom, shooting star at the top.

• Often indicates the end of a correction.

4️⃣ Doji

• The forces of buyers and sellers are equal.

• Can signal either a reversal or a continuation. ⚠️ Wait for confirmation!

➡️ Trend Continuation Patterns

1️⃣ Gaps

• A price gap that confirms the strength of the trend.

2️⃣ Three Methods

• One large candle + 3 small candles at the same level.

• Similar to a "flag" and indicates the continuation of movement.