Master Candlestick Patterns: Never Lose with These Trading Signals
✅ Bullish Patterns (Reliable Buy Signals)**
*Spot these to capitalise on upward trends:*
1. **Hammer / Inverted Hammer**
- *Function:* Bottom reversal signal.
- *Key Tip:* Confirm near **support/demand zones**.
2. **Bullish Engulfing**
- *Function:* Strong reversal pattern.
- *Confirmation:* Current candle fully "engulfs" the prior bearish candle.
3. **Morning Star**
- *Function:* Powerful 3-candle trend reversal setup.
4. **Piercing Line**
- *Function:* Signals aggressive buying after a gap-down open.
5. **Three White Soldiers**
- *Function:* Confirms uptrend continuation.
**⚠️ Indecisive Patterns (Market Uncertainty)**
*Trade cautiously with these:*
1. **Doji / Spinning Top**
- *Meaning:* Suggests trend weakness or reversal.
- *Action:* Wait for confirmation (next candle).
2. **High Wave**
- *Meaning:* Indicates extreme volatility.
- *Strategy:* Avoid trades or scalp with a strict stop-loss.
**❌ Bearish Patterns (Strong Sell Signals)**
*Identify downtrend opportunities:*
1. **Shooting Star / Hanging Man**
- *Function:* Top reversal signals.
- *Key Tip:* Validate near **resistance zones**.
2. **Bearish Engulfing**
- *Function:* Reversal pattern where the bearish candle fully covers the prior bullish candle.
3. **Evening Star**
- *Function:* Reliable downtrend reversal signal.
4. **Three Black Crows**
- *Function:* Confirms downtrend continuation.
5. **Dark Cloud Cover**
- *Function:* Reversal pattern where the bearish candle covers >50% of the prior bullish candle.
📌 Pro Trader Tactics**
*Maximise accuracy with these rules:*
- Layer Signals:** Combine patterns with support/resistance, Fibonacci levels, or trendlines.
- **Verify Volume:** Ensure volume confirms the pattern’s direction.
- Avoid Blind Trust:** Cross-verify with market structure, EMA/SMA, or other indicators.
- Mandatory Risk Management:** Always set stop-loss (SL)—patterns can fail!