The image presents four key Japanese candlestick patterns, each indicating a possible change or continuation in market direction. Understanding these formations is fundamental for technical analysis.
Reversal Patterns (A and B):
Pattern A:
Is the Evening Star, a bearish reversal formation of three candles. It occurs after an uptrend: a large green candle (buying dominance), followed by a small body candle (indecision, the 'star') and finally, a large red candle that closes within the body of the first. This suggests that the bullish momentum has ended and that sellers are taking control.
Pattern B:
Is the Morning Star, the bullish counterpart. It occurs after a downtrend: a large red candle, a small candle (indecision), and a large green candle that closes within the body of the first. This sequence is a strong signal that selling pressure is waning and that buyers are entering, anticipating an upward turn.
Continuation Patterns (C and D):
Pattern C:
Represents a Bearish Harami (or Harami Cross if the small candle is a doji), a signal of bearish reversal or consolidation. A large green candle is followed by a small red candle whose body is completely contained within the body of the previous candle. It indicates that the bullish trend has weakened, showing indecision or a possible market top.
Pattern D:
Illustrates the formation of Three White Soldiers, a reversal or strong bullish continuation pattern. It consists of three long consecutive green candles that close progressively higher, with very little or no lower wick. This is an indicator of a strong and imminent buying momentum that consistently overpowers sellers.#CPIWatch #WriteToEarnUpgrade $BNB {spot}(BNBUSDT)
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