#chartpattern

Most popular chart pattern

Hammer & Hanging Man**

- **Hammer (Bullish Reversal)**: Small body, long lower wick (2-3x body), appears after downtrend.

- **Hanging Man (Bearish Reversal)**: Identical shape to hammer, but after an *uptrend*.

- *Psychology*: Sellers push price down, but buyers regain control (hammer) or fail to hold highs (hanging man).

2. **Bullish/Bearish Engulfing**

- **Bullish Engulfing**: Green candle *fully covers* the previous red candle (downtrend reversal).

- **Bearish Engulfing**: Red candle *fully covers* the previous green candle (uptrend reversal).

- *Key*: Strong momentum shift; larger the engulfing candle, stronger the signal.

3. **Doji** (Indecision)

- Open ≈ Close (tiny body), long wicks. Signals exhaustion.

- **Dragonfly Doji** (bullish reversal): Long lower wick, no upper wick.

- **Gravestone Doji** (bearish reversal): Long upper wick, no lower wick.

- *Works best* at trend extremes.

4. **Morning Star & Evening Star**

- **Morning Star (Bullish)**: [Downtrend] Long red → small candle (doji/star) → long green.

- **Evening Star (Bearish)**: [Uptrend] Long green → small candle → long red.

- *Confirms* reversal; the "star" gaps away from prior candle.

5. **Shooting Star & Inverted Hammer**

- **Shooting Star (Bearish)**: Long upper wick, small body near low, *after uptrend*.

- **Inverted Hammer (Bullish)**: Same shape as shooting star, but *after downtrend*.

- *Psychology*: Failed breakout (sellers reject highs/lows).