Candlestick Patterns can only give a trader a small percentage of what is happening in the market. The use of multiple time frames and indicators will help to increase the accuracy of any trading system.
1 Like
I think the W candlestick pattern works the most for me. By using this pattern I am able to get profits most of the time. The pattern is also very common and can be spotted in a forex chart every few days.
If I would be forced with a gun to my head to trade using only a candle pattern, it would be a pin bar.
If any 1-4 candles blend to pin bar, I treat this as potential rejection signal.
But it is usually not enough. For intraday charts I look more for volume/levels than exact patterns.
If price move is supported by volume (eg. price goes up, volume goes up) and at near support/resistance volume dries and candles show sign of weakness (longer, onesided wicks) it feels like at least small correction to jump in. It does not have to be any āpopularā pattern at all, but if I see āpopularā pattern with good volume scenario, near obvious level - thatās even better.
1 Like
Candlestick patterns are representative of opening/closing and highest/lowest prices in longer time frames. If used wisely along with other financial instruments, they can help in predicting future price movements. Personally, doji has been really helpful in cracking market sentiments as they are formed when the opening and closing price of the stock are the same.
Candlesticks are important to find the zones of demand and supply. Solely depending upon the candles can make you trouble when you have opened a position or want to do so because most of the time candles appear to be fake. Better to use other tools like fibonacci to confirm the pullbacks.
An engulfing followed by some inside bars, then it gets interesting in the direction of the engulfing , I think.
Candlestick charts are very useful as they represent opening/closing and highest/lowest prices in a longer time period. Future price movements can be predicted using these charts. There are 12 types of candlestick charts: Marubozu, Dji, Spinning Top, Engulfing Pattern, Piercing Pattern, Dark Cloud Cover, Harami, Hammer, Hanging Man, Morning Star, Evening Star and Shooting Star. Personally, I find the Doji Pattern extremely helpful as it represents the market when it has gone from a yang or ying quality to neutral state.
Theirs not a pattern that is best, itās more about how you read them
1 Like
The best candlestick in my opinion is the gravestone Doji as it is formed when the open, low and closing prices of an asset are close to each other with a long upper shadow. Easy to comprehend, this pattern resembles a gravestone and is very helpful for traders of all magnitude to predict future price movements.
The best candlestick pattern that is easy to comprehend and highly effective is the shooting star. It is formed when the price of an asset opens and rises but then closes near the open price. A bearish pattern, it features a long upper shadow and no lower shadow at all.
Of course, the best candlestick pattern is the one that gets you into a trend. Iām saying the precise design details arenāt the most important thing.
Easy to comprehend and use, the doji candlestick pattern is the best in my opinion. It is characterised by a ācross shapeā and represents a forex currency pair that has the same opening and closing level. It is indicative of a sign of indecision.
Candlestick patterns can help traders determine the price movements based on past patterns.
For any time frame, a candlestick pattern tells four things about a currency pair- its open, close, high, and low prices. Candlestick patterns are single and combinational.
Some of the helpful candlestick patterns are Doji, Engulfing, Piercing, Morning Star, Evening Star, Hammer, Inverted Hammer, Morabozu, and Harmai. Patterns indicate whether buyers or sellers are winning. However, they donāt guarantee anything 100%. You should verify your predictions with the help of other tools.
There is no such thing as the best candlestick pattern because they change based on the pairs, but What counts is what you understand and what works for you. You should continue to try and learn.
Understanding candlestick pattern plays a vital role in trading because every candle has a meaning. Those who understand candlestick pattern can trade based on these. They donāt need to use other indicators to analyze the market.
1 Like
I would agree it has a role but market structure and liquidity are more important imo
To be very honest, donāt focus on the candle patterns so blindly! You have to understand one thing: If you follow the Candle pattern without the market context! That means, you are in a danger! Try to focus on the whole scenario; instead of any particular pattern!
Did you mean any specific patter of the Forex market or anything else? According to my own experience, without the market context; patterns are valueless!
Quite useful, thanks.
Rayner on Youtube got some good stuff on candlestick patterns