Experienced traders, how important are candlestick patterns to you?

Well that, in itself, is a valid comment on the use of candlesticks. Different people will see different things. :slight_smile:

This was not intended as a detailed analysis, just a quick at-a-glance scan across the chart. Two of them are pin bar types that would have suggested (a) a further break down and (b) a follow-through move up.

That middle red grouping of three candles are almost inside days but the second down day, finishing right on the lows, would have suggested to me a confirmation of the first down day and possible continuation down - which didn’t happen.

I am sure there are other ways of interpreting these, depending on which groupings, etc, are included - and especially with the benefit of hindsight.

I had memorized all the candlestick patterns and had created a screen wallpaper comprised of the patterns I thought were the most important and reliable. That was a long time ago. Now I primarily use range charts and can only remember 2 or maybe 3 patterns. I don’t use them anymore.


When you were using patterns, what timeframes were you mostly applying them to?
Do you have any view on which timeframes they did/didn’t function most, or was the result the same on any timeframe?
(I just thought this might be of interest to people using candle patterns)

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Short answer: I don’t remember. Long answer follows …

I’ve been trading for nearly 3 years now and candlestick patterns is the first thing I honed in on. There is an educator by the name of Steven Primo who is big on it. I even bought a candlestick patterns course from someone who Steven recommended highly. But I very quickly came to the realization that candlestick patterns are not a reliable way to trade. I tried using the patterns on various timeframes ranging from 5 mins to daily charts but being that it was so long ago and also very early in my trading journey, my recollection of which timeframes these patterns worked the best on is not very good.

Also once I dismissed candlestick patterns I went back to looking for a better way to trade and found my way to price action trading. PA resonated with me so I mentally cleared my mind of everything else I had learned upto that point. That included candlestick patterns.

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My experiences are somewhat similar to yours, @QuadPip and i also came across Primo at some stage, i don’t recall when either!

I have several times tried to look at these over the years but it has never really caught my interest and i always just seemed to find myself forgetting to look at them. They simply weren’t adding on anything beyond what i was already doing and there was no point in studying it further.

But the fact that they are a video recording of what price has actually done during the time of the candle does suggest there is value in analysing them and so i am reluctant to dismiss them totally. But on the other hand there are often occasions where the subsequent candle is the complete reversal of the former - which again shows that a single isolated candle movement does not reliably tell you anything!


Sorry but what is the different between trading candelstick patterns and trading price action?

I’m just going to take a stab at it and see how I go:

Trading candlestick patterns is waiting for the price to show me something over time before I decide what to do. Where as trading price action is seeing what’s happening at this moment and not looking into the past.

How far off am I?


Price action has nothing to do with candlestick patterns or even chart patterns. Essentially PA takes into account market structure. As price moves it leaves behind clues as to where it will go next and how far it will travel. Price, in its movements, follows certain rules. The better you get at reading the naked chart the easier your trading will get.

See my posts in the thread linked below for more info and an example trade based on PA. Notice also that the identification of a trend change, in the linked post, relies on market structure.

I think any PA on longer timeframes is more significant. PA on the shorter timeframes has a higher probability of being “noise” imo.

I have never been able to trade on anything less than the 4hr, altough im sure there are many traders that prefer the shorter time frames.

I think it comes down to ones style and apptitude. There is no right or wrong as long as long the end result is positive expectancy over the long term.

How would you define a person that prefers the shorter timeframe? Are they more risk takers or have higher energy?

Thats a good question.

Sure you could say thay they have a higher risk tolerance or are higher energy or maybe they tend to lean towards scalping, but I wouldnt want to put a label on a trader simply because they have a different strategy.

I would just say that they are different because they view the market another way.

Every trader and strategy is different, that doesnt mean that one point of view is any better than the other.

We all have to figure out what works for us, there is no right way or wrong way.

I would say however that there are certain universal trading principles that most succesful traders seem to have in common, regardless of how different their approach or strategey may be.

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For me, the lower time frames don’t bother me so much. It’s holding trades open overnight that kill me.

It’s amazing how we are all on the same journey except we have to figure it out ourselves. No on can tell us how to do it except maybe guide us. we all look at the market from our own perspective.

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market is fractal. every pattern and candle formation that u see on daily weekly etc u can also spot on 1m 5m 15 etc. it s the time that make s the difference. for ex the same pattern that on daily might give a down move of 300 pips on 15 m might just last 50 and so on, trading the lower TFS has to do with risk tolerance imho, as for me , no matter how big my account was, it s just stressful not to try and pick the right timing to go in on a lower tf with a tighter stop rather hen having a hundreds of pips stop and just go in random cos i think major move is up. i just can t trade like that on a psich level, not saying it s wrong, i think it s all about ur mentality and the way u see things. tha and plus don t have the patince to take daily setups and wait weeks possibly on end, i could take that dail setup on a lower tf, take some profit off, set BE and then let it run out for days but knowing it s a risk fee trade. like i said, i think it s mostly in our minds that determines the way we trade.

If price movements are fractal in nature then why would PA be different on the lower timeframes? Market structure applies equally to all timeframes and so does PA. Trends change first on the lower timeframes before the change appears on the higher timeframes.

We consult a higher timeframe for our analysis simply because it gives us the bigger picture. We execute our trades on a lower timeframe because it allows us to trade with greater precision.

Whether you like to to trade the lower timeframes or the higher timeframes is but a matter of personal preference.


I always enjoy your contribution. Keep it up bro

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I tried candestick patterns, the results were zero. When I started using harmonic patterns to find market pivots, the results were good.

Thank you everyone for the detail discussion. Ill look at price action more and how to use it. Thanks!

If your thinking about using them in a conventional sense I don’t bother much, although as a visual display there great.

Ive come up with my own ways to interpret them.
for example I only ever take pin bar and inside bar set ups when an harami is present in the pattern.

I think it reduces market noise.

Also I like to get in a trade before the engulf develops.

By that I mean as soon as a market takes out a low of previous bar, I then place a buy stop at the previous high.

This means that if an engulfing pattern is to develop I’m already in.

Finally I like placing buy stops above the highs of inverted hammers, if hit within one bar they often lead to big moves, on a daily chart anyway.

I don’t think these are traditional ways to use candlestick patterns but they seem to work for me.

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Hmm I like that makes more sense to use because there are rules. I will save what you wrote here and try. Appreciate your advise!

Candlesticks work exactly as indicators.

Indicators remove noise, also candlesticks, a bar is an histogram to remove the intrabar noise.

Candlesticks, moving averages, indicators are the basic constituents of a trading system.
When you know how to use them you have 1% of what you need to beat the market.

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Disagree - candlesticks can give you exact entries and exits - something indicators cannot.

I would also argue with the right patterns and traded in the right way you have much more than 1%

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