Candlestick Patterns
Candlestick patterns in trading evaluate the performance and outcomes of trading strategies by identifying individual candlestick formations that signal potential market moves. Here are some of the most commonly used single candlestick patterns:
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Candlestick pattern formations reflect collective market psychology over multiple candles - they help traders spot shifts in momentum, exhaustion, or continuation with greater clarity.
- Bullish Patterns: Signal potential upward movement or reversal, such as the Hammer.
- Bearish Patterns: Indicate possible downward movement or reversal, including patterns like the Hanging Man.
- Special Patterns: Reflect indecision in the market, such as the Spinning Top, hinting at a pause or upcoming shift.