#candlestick_patterns
In order to analyze Candlestick patterns, there are a few point to research and study about, including:
1. Components
- Open: Price at the start of the period.
- Close: Price at the end of the period.
- High: Highest price during the period.
- Low: Lowest price during the period.
2. Body and Wicks
- Body: Difference between open and close prices.
- Green/White: Bullish (close > open).
- Red/Black: Bearish (close < open).
- Wicks (Shadows): Lines indicating price extremes (high/low).
3. Types of Candlesticks
- Bullish Candlestick: Closes higher than it opens.
- Bearish Candlestick: Closes lower than it opens.
- Doji: Open and close are nearly equal, indicating indecision.
- Hammer: Small body at the top with a long lower wick, signaling potential bullish reversal.
- Shooting Star: Small body at the bottom with a long upper wick, signaling potential bearish reversal.
4. Patterns
- Engulfing Pattern: Second candle engulfs the first; indicates potential trend reversal.
- Morning Star: A three-candle pattern signaling bullish reversal.
- Evening Star: A three-candle pattern signaling bearish reversal.
5. Usage
- Trend Analysis: Identify market trends and reversals.
- Support/Resistance: Determine key price levels.
- Time Frames: Applicable across various time frames (1-minute to monthly).
6. Practice
- Utilize charting software for analysis and pattern recognition.
This is so to absorb and analysis the data changes in candlestick indicators faster and better understanding on how it work. God bless!!
