Thanks @xetatrader for posting the chart.
I will try to explain as best I can using your chart. I see it’s a daily chart of the NZD but not sure what the other currency pair is. If I knew that I would be able to pull up the same chart on my computer and then mark candles so that you would understand better what I am tying to say.
So let me give it a go and if you don’t understand something let me know.
The candle you have marked with the red arrow is just a doji in what has become a down trend. The thing that interests me about that doji is that it tested the moving average and then retraced to close nearly at its open price. That is a good sign that the bears are in control. Yes there was some sideways price action before the trend continued down but that can be expected as bears that sold at the start of that trend take some profits and bulls buy betting on a trend reversal.
That line you have drawn looks like a support level and what is important is that price hung around that support level for several bars before a break down from that support level occurred. That is a great entry as you can see that the bears have taken control of the market and the bulls are not interested in buying until there is a lower price.
Just to add to what I have said what really interests me and what I was trying to explain in my first post to you, is what happens at the start of price action on that chart.
Notice the first four candles are bull candles then you have a pin bar. That says that buying is slowing because the bear candle that followed was too small to suggest that the bears are starting to take control. The next green pin bar just before that big red bear candle is more promising that there is now a lack of buyers and that selleres are moving into the market. Remember when i said that I like to wait for a retest of that first pin bar before I entered well that happened some 13 bars after that first big bear candle. It created a double top followed by a reasonable bear candle that closed on it’s low and that would have been a signal for me to go short. Even if you waited for a second bear bar which happened you still would have been in early enough to catch a great trade.
It’s easy to read a chart once you see all the candles like on this chart. it’s another to read the chart as it is happening in real time. That’s why understanding how to read price action and know what a candle is telling you is vital to taking good trades.
Hope you understand what I have tried to explain to you.