Day 48: Advanced Candlestick Patterns to Look For
Candlestick patterns are the language of price action, revealing market sentiment and potential reversals. While basic patterns like Doji and Engulfing are well-known, advanced traders focus on nuanced formations for better precision.
1. Three Black Crows & Three White Soldiers
These multi-candle patterns signal strong momentum shifts. Three consecutive long bearish candles (Black Crows) indicate a potential downtrend, while Three White Soldiers—three strong bullish candles—suggest an uptrend.
2. Abandoned Baby
This rare but powerful reversal pattern occurs when a Doji gaps above (bullish) or below (bearish) the previous candle, followed by a strong opposite move. It indicates exhaustion of the prior trend.
3. Tweezers (Top & Bottom)
Tweezers appear at market extremes. A tweezer top shows two candles with identical highs, signaling bearish rejection, while a tweezer bottom forms at identical lows, hinting at bullish strength.
4. Kicker Pattern
This high-impact reversal occurs when a strong bullish or bearish candle follows an opposite-colored candle with a significant gap. It often indicates news-driven or institutional moves.
Mastering these advanced candlestick formations helps traders anticipate market direction with greater confidence. Which of these patterns have worked best for you?
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