Candlestick Patterns
Playing Markets
Understanding Candlestick Patterns
Candlestick patterns are one of the most straightforward technical analysis tools. This makes learning to interrupt them a useful trading skill.
They are made up of one or more candlesticks with specific criteria regarding candlestick types, pre-existing trend, and more. Learning to recognize candlestick patterns is the easy part. Incorporating them into an effective trading strategy is where things get more difficult.
Types of Candlestick Patterns
There are over 100 recognized candlestick patterns. They can be divided based on the directional bias they imply, either bearish or bullish. And the vast majority of them can also be divided into either candlestick reversal patterns or candlestick continuation patterns.
Abandoned Baby Patterns
An abandoned baby pattern is a 3-candlestick formation that may signal a reversal. It is made up of a long candle moving in the direction of current trend, a doji that gaps, and another long candle that gaps and moves in the opposite direction of the first (and trend).
How Abandoned Baby Patterns Work
Breakaway Patterns
A breakaway pattern is a 5-candlestick formation that may signal a reversal. It consists of a large candle moving with the current trend, followed by a small candle that gaps, two more candles whose closes further the trend, and a large candle moving against trend that closes within the gap of the first two candles.
Counterattack Lines Patterns
A counterattack line pattern is a 2-candlestick formation that may signal a reversal. It is made up of a long candle moving in the direction of current trend followed by a second candle that opens with a gap that then moves in the opposite direction, filling the gap to close near the first candle’s close.
How Counterattack Lines Patterns Work
Doji Star Patterns
A doji star pattern is a 3-candlestick formation that may signal a reversal. It is made up of a large candle moving in the direction of current trend, a doji, and another large candle that moves in the opposite direction of the first (and trend).
Engulfing Candlestick Patterns
An engulfing candlestick pattern is a 2-candlestick formation that may signal a reversal. It is made up of one candle moving in the direction of current trend followed by a second candle that opens and closes above and below that of the first candle, or vice versa.
How Engulfing Candlestick Patterns Work
Harami Patterns
A harami pattern is a 2-candlestick formation that may signal a reversal. It is made up of a long candle moving in the direction of current trend followed by a small candle moving in the opposite direction. The trading range of the second candle must be completely contained within that of the first.
Harami Cross Patterns
A harami cross pattern is a 2-candlestick formation that may signal a reversal. It is made up of a long candle moving in the direction of current trend followed by a doji candlestick. The trading range of the second candle must be completely contained within that of the first.
How Harami Cross Patterns Work
Gap Three Methods Patterns
A gap three methods pattern is a 3-candlestick formation that may signal a reversal. It consists of two large candles with a gap between them moving in the direction of trend followed by a large candle that opens inside the preceding candle and closes the gap between the first two.
How Gap Three Methods Patterns Work
In Neck Patterns
An in neck pattern is a 2-candlestick formation that may signal a continuation. It is made up of a long candle moving in the direction of current trend followed by a gap and a shorter candle that fills the gap to close near the close of the previous candle.
Kicking Patterns
A kicking (or “kicker”) pattern is a 2-candlestick formation that may signal a reversal. It consists of a marubozu candle moving with the current trend followed by a marubozu candle moving against the trend that is preceded by a gap on the opening side of the previous candle.
Ladder Patterns
A ladder pattern is a 5-candlestick formation that may signal a reversal. It consists of three large candles moving with the current trend, a small candle with a wick in the opposite direction of the trend, and a large candle that moves against the trend preceded by a gap against the trend and close beyond the wick of the fourth.
Last Engulfing Patterns
A last engulfing pattern is a 2-candlestick formation that may signal a continuation. It consists of a large candle moving against the current trend followed by a large candle moving with the trend that is preceded by a gap and closes beyond the open of the first.
How Last Engulfing Patterns Work
Mat Hold Patterns
A mat hold pattern is a 5-candlestick formation that may signal a continuation. It is made up of a large candlestick moving in the direction of current trend, followed by a gap and three shorter candles that move against trend but do not close beyond the open of the first candle, then another large candle that closes beyond all prior candles in the direction of trend.
Matching Patterns
A matching pattern is a 2-candlestick formation that may signal a reversal. It consists of a large candle moving with the current trend followed by a candle moving with the trend that opens inside the body of the first and closes at the same price as the first.
Meeting Lines Patterns
A meeting lines pattern is a 2-candlestick formation that may signal a reversal. It consists of a large candle moving with the current trend followed by a large candle moving against the trend that is preceded by a gap and closes at the same price as the first.
How Meeting Lines Patterns Work
On Neck Patterns
An on neck pattern is a 2-candlestick formation that may signal a continuation. It is made up of a long candle moving in the direction of trend followed by a gap and a shorter candle that fails to fill the gap, closing near the high or low of the previous candle.
Separating Lines Patterns
A separating lines pattern is a 2-candlestick formation that may signal a continuation. It consists of a large candle moving against the current trend followed by a large candle with the same open as the first candle that resumes the trend.
How Separating Lines Patterns Work
Star Patterns
A star pattern is a 3-candlestick formation that may signal a reversal. It is made up of a large candle moving in the direction of current trend, a short candle, and another large candle that moves in the opposite direction of the first (and trend).
Stomach Patterns
A stomach pattern is a 2-candlestick formation that may signal a reversal. It consists of a large candle moving with the current trend followed by a large candle moving against the trend that opens halfway inside the body of the first and closes beyond its open.
Tasuki Gap Patterns
A tasuki gap pattern is a 3-candlestick formation that may signal a continuation. It is made up of a candle moving in the direction of trend, followed by a gap, another candle moving in the direction of trend, and then a candle moving against trend that partially closes the gap between the first two.
Three Inside Patterns
A three inside pattern is a 3-candlestick formation that may signal a reversal. It is made up of a large candle moving in the direction of trend followed by a shorter countertrend candle that opens and closes within the body of the first, then another countertrend candle that breaks through and closes beyond the open of the first candle.
How Three Inside Patterns Work
Three Methods Patterns
A three methods pattern is a 5-candlestick formation that may signal a continuation. It is made up of a large candlestick moving in the direction of current trend, followed by three shorter candles that move against trend but do not close beyond the open of the first candle, then another large candle that closes beyond all prior candles in the direction of trend.
How Three Methods Patterns Work
Three Outside Patterns
A three outside pattern is a 3-candlestick formation that may signal a reversal. It is made up of one candle moving in the direction of the current trend, followed by a large engulfing candlestick moving against trend, and finally a third candlestick that continues the move against trend.
How Three Outside Patterns Work
Three-Line Strike Patterns
A three-line strike pattern is a 4-candlestick formation that may signal a reversal. It consists of three large candles moving with the current trend followed by a large candle moving against the trend that is preceded by a gap and closes beyond the open of the first candle.
How Three-Line Strike Patterns Work
Tri-Star Patterns
A tri-star pattern is a 3-candlestick formation that may signal a reversal. It consists of a doji, a gap in the direction of trend, another doji, a gap in the opposite direction of trend, and another doji.
Tweezer Patterns
A tweezer pattern is a 2-candlestick formation that may signal a reversal. It is made up of a large candlestick moving in the direction of trend followed by another one moving against trend. The wicks must be nearly even on the trend side of both candles and the first close must match the second open.
Window Patterns
A window pattern is a 2-candlestick formation that may signal a continuation. It is made up of two large candles moving in the direction of current trend with a gap between them.
Bearish Candlestick Patterns
Bearish candlestick patterns are those that imply a downward bias on upcoming price action. They can be divided into two main groups. Bearish reversal candlestick patterns may signify the end of an uptrend. Bearish continuation candlestick patterns may signify further bearish price action during a downtrend.
Bearish Abandoned Baby Patterns
A bearish abandoned baby pattern is a 3-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a large bullish candle, a doji that gaps up, and a large bearish candle that gaps down.
How Bearish Abandoned Baby Patterns Work
Bearish Breakaway Patterns
A bearish breakaway is a bearish reversal formation. They occur during uptrends and consist of 1) a large-bodied candlestick moving up, 2) a small-bodied candlestick that gaps up, 3) two candlesticks with progressively higher closes, and 5) a large bodied candlestick moving down that closes in the gap between the first two.
How Bearish Breakaway Patterns Work
Bearish Counterattack Lines Patterns
A bearish counterattack line pattern is a 2-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a large bullish candle followed by a large bearish candle that opens with a large gap up then moves lower, filling the gap to close near the first candle’s close.
How Bearish Counterattack Lines Patterns Work
Evening Doji Star Patterns
An evening doji star pattern is a 3-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a large bullish candle followed by a doji and a large bearish candle.
How Evening Doji Star Patterns Work
Bearish Engulfing Candlestick Patterns
A bearish engulfing candlestick pattern is a 2-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a bullish candle and a large bearish candle that opens above and closes below the first, fully containing the trading range of the first.
How Bearish Engulfing Candlestick Patterns Work
Bearish Harami Patterns
A bearish harami pattern is a 2-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a large bullish candle followed by a small bearish (or neutral) candle. The trading range of the second candle must be completely contained within the body of the first.
How Bearish Harami Patterns Work
Bearish Harami Cross Patterns
A bearish harami cross pattern is a 2-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a large bullish candle followed by an inside doji candlestick. The trading range of the second candle must be completely contained within that of the first.
How Bearish Harami Cross Patterns Work
Upside Gap Three Methods Patterns
An upside gap three methods is a bearish reversal formation. They occur during uptrends and consist of 1) a large-bodied candlestick moving up, 2) another large-bodied candlestick moving up that is preceded by a gap, and 3) a large bodied candlestick moving down that opens inside the second candle fills the gap.
How Upside Gap Three Methods Patterns Work
Bearish In Neck Patterns
A bearish in neck pattern is a 2-candlestick formation that may signal a bearish continuation. It may appear in a downtrend and is made up of a large bearish candle followed by a gap down and smaller bullish candle that fills the gap and closes near the close of the first candle.
How Bearish In Neck Patterns Work
Kicking Down Patterns
A kicking down (or “bearish kicking” or “bearish kicker”) is a bearish reversal formation. They occur during uptrends and consist of 1) a large-bodied marubozu candlestick moving up followed by 2) a large-bodied marubozu candlestick moving down that is preceded by a gap down.
How Bearish Kicker Patterns Work
Ladder Top Patterns
A ladder top is a bearish reversal formation. They occur during uptrends and consist of 1) three large-bodied candlesticks moving up, 2) a small-bodied candlestick moving up (or remaining neutral) that has a lower wick, and 3) a large-bodied candlestick moving down that is preceded by a gap down and closes below the lower wick of the fourth.
Last Engulfing Bottom Patterns
A last engulfing bottom is a bearish continuation formation. They occur during downtrends and consist of 1) a large-bodied candlestick moving up and 2) a large-bodied candlestick moving down that opens above and closes below the body of the first.
How Last Engulfing Bottom Patterns Work
Bearish Mat Hold Patterns
A bearish mat hold pattern is a 5-candlestick formation that may signal a bearish continuation. It may appear in a downtrend and is made up of a large bearish candlestick followed by a gap down and three smaller bullish (or neutral) candles that fill the gap but never close above the first candle’s open, then another large bearish candle that closes below all previous candles.
How Bearish Mat Hold Patterns Work
Matching High Patterns
A matching high is a bearish reversal formation. They occur during uptrends and consist of 1) a large-bodied candlestick moving up and 2) a candlestick moving up that opens inside the first and closes at the same price.
How Matching High Patterns Work
Bearish Meeting Lines Patterns
A bearish meeting lines is a bearish reversal formation. They occur during uptrends and consist of 1) a large-bodied candlestick moving up and 2) a large-bodied candlestick that opens with a large gap up then moves down to close at the same price as the first candle.
How Bearish Meeting Lines Patterns Work
Bearish On Neck Patterns
A bearish on neck pattern is a 2-candlestick formation that may signal a bearish continuation. It may appear in a downtrend and is made up of a large bearish candle followed by a gap down and a smaller bullish candle that partially fills the gap and closes near the low of the previous candle.
How Bearish On Neck Patterns Work
Bearish Separating Lines Patterns
A bearish separating lines is a bearish continuation formation. They occur during downtrends and consist of 1) a large-bodied candlestick moving up and 2) a large-bodied candlestick with the same open as the first candle that moves down.
How Bearish Separating Lines Patterns Work
Evening Star Patterns
An evening star pattern is a 3-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a large bullish candle followed by a short candle and a large bearish candle.
How Evening Star Patterns Work
Below the Stomach Patterns
A below the stomach candlestick pattern is a bearish reversal formation. They occur during uptrends and consist of 1) a large-bodied candlestick moving up and 2) a large-bodied candlestick moving down that opens at the midpoint of the first and closes below its open.
How Below the Stomach Patterns Work
Downside Tasuki Gap Patterns
A downside tasuki gap pattern is a 3-candlestick formation that may signal a bearish continuation. It may appear during a downtrend and is made up of a large bearish candle, a gap down, and another large bearish candle, followed by a bullish candle that partially closes the gap between the first two.
How Downside Tasuki Gap Patterns Work
Three Inside Down Patterns
A three inside down pattern is a 3-candlestick formation that may signal a reversal. It may appear during an uptrend and is made up of a large bullish candle followed by a shorter bearish (or neutral) inside candle and another bearish candle that closes below the open of the first candle.
How Three Inside Down Patterns Work
Falling Three Methods Patterns
A falling three methods pattern is a 5-candlestick formation that may signal a bearish continuation. It may appear in a downtrend and is made up of a large bearish candlestick, three smaller bullish (or neutral) candles that never close above the first candle’s open, then another large bearish candle that closes below all previous candles.
How Falling Three Methods Patterns Work
Three Outside Down Patterns
A three outside down pattern is a 3-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a bullish candle followed by a large bearish engulfing candlestick and another bearish candle after that.
How Three Outside Down Patterns Work
Bullish Three-Line Strike Patterns
A bullish three-line strike is a bearish reversal formation. They occur during uptrends and consist of 1) the large-bodied candlesticks moving up and 2) a large-bodied candlestick moving down that is preceded by a gap up and closes below the open of the first candle.
How “Bullish” Three-Line Strike Patterns Work
Bearish Tri-Star Patterns
A bearish tri-star is a bearish reversal formation. They occur during uptrends and consist of 1) a doji candlestick, 2) a doji candlestick preceded by a gap up, and 3) a doji candlestick preceded by a gap down.
How Bearish Tri-Star Patterns Work
Tweezer Top Patterns
A tweezer top pattern is a 2-candlestick formation that may signal a bearish reversal. It may appear during an uptrend and is made up of a large bullish candlestick followed by a large bearish candlestick where the top of the bodies and wicks of each candle match each other.
Falling Window Patterns
A falling window pattern is a 2-candlestick formation that may signal a bearish continuation. It may appear during a downtrend and is made up of two large bearish candles with a gap between them.
Bullish Candlestick Patterns
Bullish candlestick patterns are those that imply a upward bias on upcoming price action. They can be divided into two main groups. Bullish reversal candlestick patterns may signify the end of a downtrend. Bullish continuation candlestick patterns may signify further bullish price action during an uptrend.
Bullish Abandoned Baby Patterns
A bullish abandoned baby pattern is a 3-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a large bearish candle, a doji that gaps down, and a large bullish candle that gaps up.
How Bullish Abandoned Baby Patterns Work
Bullish Breakaway Patterns
A bullish breakaway is a bullish reversal formation. The occur during downtrends and consist of 1) a large-bodied candlestick moving down, 2) a small-bodied candlestick that gaps down, 3) two candlesticks with progressively lower closes, and 5) a large bodied candlestick moving up that closes in the gap between the first two.
How Bullish Breakaway Patterns Work
Bullish Counterattack Lines Patterns
A bullish counterattack line pattern is a 2-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a large bearish candle followed by a large bullish candle that opens with a large gap down then moves higher, filling the gap to close near the first candle’s close.
How Bullish Counterattack Lines Patterns Work
Morning Doji Star Patterns
A morning doji star pattern is a 3-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a large bearish candle followed by a doji and a large bullish candle.
How Morning Doji Star Patterns Work
Bullish Engulfing Candlestick Patterns
A bullish engulfing candlestick pattern is a 2-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a bearish candle and a large bullish candle that opens below and closes above the first, fully containing the trading range of the first.
How Bullish Engulfing Candlestick Patterns Work
Bullish Harami Patterns
A bullish harami pattern is a 2-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a large bearish candle followed by a small bullish (or neutral) candle. The trading range of the second candle must be completely contained within the body of the first.
How Bullish Harami Patterns Work
Bullish Harami Cross Patterns
A bullish harami cross pattern is a 2-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a large bearish candle followed by an inside doji candlestick. The trading range of the second candle must be completely contained within that of the first.
How Bullish Harami Cross Patterns Work
Downside Gap Three Methods Patterns
A downside gap three methods is a bullish reversal formation. They occur during downtrends and consist of 1) a large-bodied candlestick moving down, 2) another large-bodied candlestick moving down that is preceded by a gap, and 3) a large-bodied candlestick moving up that opens inside the second candle and fills the gap.
How Downside Gap Three Methods Patterns Work
Bullish In Neck Patterns
A bullish in neck pattern is a 2-candlestick formation that may signal a bullish continuation. It may appear in an uptrend and is made up of a large bullish candle followed by a gap up and smaller bearish candle that fills the gap and closes near the close of the first candle.
How Bullish In Neck Patterns Work
Kicking Up Patterns
A kicking up (or “bearish kicking” or “bearish kicker”) is a bullish reversal formation. They occurring during downtrends and consist of 1) a large-bodied marubozu candlestick moving down followed by 2) a large-bodied marubozu candlestick moving up that is preceded by a gap up.
How Bullish Kicker Patterns Work
Ladder Bottom Patterns
A ladder bottom is a bullish reversal formation. They occur during downtrends and consist of 1) three large-bodied candlesticks moving down, 2) a small-bodied candlestick moving down (or remaining neutral) that has an upper wick, and 3) a large-bodied candlestick moving up that is preceded by a gap up and closes above the upper wick of the fourth.
How Ladder Bottom Patterns Work
Last Engulfing Top Patterns
A last engulfing top is a bullish continuation formation. They occur during uptrends and consist of 1) a large-bodied candlestick moving down and 2) a large-bodied candlestick moving up that opens below and closes above the body of the first.
How Last Engulfing Top Patterns Work
Bullish Mat Hold Patterns
A bullish mat hold pattern is a 5-candlestick formation that may signal a bullish continuation. It may appear in an uptrend and is made up of a large bullish candlestick followed by a gap up and three smaller bearish (or neutral) candles that fill the gap but never close below the first candle’s open, then another large bullish candle that closes above all previous candles.
How Bullish Mat Hold Patterns Work
Matching Low Patterns
A matching low is a bullish reversal formation. They occur during downtrends and consist of 1) a large-bodied candlestick moving down and 2) a candlestick moving down that opens inside the first and closes at the same price.
How Matching Low Patterns Work
Bullish Meeting Lines Patterns
A bullish meeting lines is a bullish reversal formation. They occur during downtrends and consist of 1) a large-bodied candlestick moving down and 2) a large-bodied candlestick that opens with a large gap down then moves up to close at the same price as the first candle.
How Bullish Meeting Lines Patterns Work
Bullish On Neck Patterns
A bullish on neck pattern is a 2-candlestick formation that may signal a bullish continuation. It may appear in an uptrend and is made up of a large bullish candle followed by a gap up and a smaller bearish candle that partially fills the gap and closes near the high of the previous candle.
How Bullish On Neck Patterns Work
Bullish Separating Lines Patterns
A bullish separating lines is a bullish continuation formation. They occur during uptrends and consist of 1) a large-bodied candlestick moving down and 2) a large-bodied candlestick with the same open as the first candle that moves up.
How Bullish Separating Lines Patterns Work
Morning Star Patterns
A morning star pattern is a 3-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a large bearish candle followed by a short candle and a large bullish candle.
How Morning Star Patterns Work
Above the Stomach Patterns
An above the stomach candlestick pattern is a bullish reversal formation. They occur during downtrends and consist of 1) a large-bodied candlestick moving down and 2) a large-bodied candlestick moving up that opens at the midpoint of the first and closes above its open.
How Above the Stomach Patterns Work
Upside Tasuki Gap Patterns
An upside tasuki gap pattern is a 3-candlestick formation that may signal a bullish continuation. It may appear during an uptrend and is made up of a large bullish candle, a gap up, and another large bullish candle, followed by a bearish candle that partially closes the gap between the first two.
How Upside Tasuki Gap Patterns Work
Three Inside Up Patterns
A three inside up pattern is a 3-candlestick formation that may signal a reversal. It may appear during a downtrend and is made up of a large bearish candle followed by a shorter bullish (or neutral) inside candle and another bullish candle that closes above the open of the first candle.
How Three Inside Up Patterns Work
Rising Three Methods Patterns
A rising three methods pattern is a 5-candlestick formation that may signal a bullish continuation. It may appear in an uptrend and is made up of a large bullish candlestick, three smaller bearish (or neutral) candles that never close below the first candle’s open, then another large bullish candle that closes above all previous candles.
How Rising Three Methods Patterns Work
Three Outside Up Patterns
A three outside up pattern is a 3-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a bearish candle followed by a large bullish engulfing candlestick and another bullish candle after that.
How Three Outside Up Patterns Work
Bearish Three-Line Strike Patterns
A bearish three-line strike is a bullish reversal formation. They occur during downtrends and consist of 1) three large-bodied candlesticks moving down and 2) a large-bodied candlestick moving up that is preceded by a gap down and closes above the open of the first candle.
How Bearish Three-Line Strike Patterns Work
Bullish Tri-Star Patterns
A bullish tri-star is a bullish reversal formation. They occur during downtrends and consist of 1) a doji candlestick, 2) a doji candlestick preceded by a gap down, and 3) a doji candlestick preceded by a gap up.
How Bullish Tri-Star Patterns Work
Tweezer Bottom Patterns
A tweezer bottom pattern is a 2-candlestick formation that may signal a bullish reversal. It may appear during a downtrend and is made up of a large bearish candlestick followed by a large bullish candlestick where the bottom of the bodies and wicks of each candle match each other.
How Tweezer Bottom Patterns Work
Rising Window Patterns
A rising window pattern is a 2-candlestick formation that may signal a bullish continuation. It may appear during an uptrend and is made up of two large bullish candles with a gap between them.