What are Candlesticks?
Candlesticks are bars which represent the number of trades done within a specific time period. It indicates the price movement of a particular asset. Traders and investors generally use candlestick patterns to identify the possible future price of an asset.
A candlestick displays open, high, low and close for that time period. Candlesticks are a graphical representation of transactions that occurred during that time period. Using these candlesticks patterns a technical analyst tries to predict the future price of an asset.
10 Important Candlesticks Patterns
- Bullish Hammer Candlestick Pattern
A bullish hammer candlestick is a reversal candlestick pattern which helps to identify possible trend reversals.
A bullish hammer candlestick pattern consists of a lower long wick which represents rejected prices. Which means that buyers are interested at lower prices and sellers are trying to book their profits.
Identification of trend and key level is important. Generally price action is combined to initiate trade to make your accuracy much better.
![Bullish Hammer candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/Screenshot-2023-10-04-154119.png)
- Shooting Star Candlestick Pattern
A Shooting Star candlestick is a bearish reversal candlestick pattern which helps to identify possible trend reversal to downside.
A shooting star candlesticks consist of an upper long wick and a small or no body.
![Shooting Star Candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/Screenshot-2023-10-04-154254.png)
- Bullish and Bearish Harami Candlestick Patterns
This pattern is formed using two candles. A bullish and bearish candlestick pattern is a reversal candlestick pattern.
The word ‘Harami’ means ‘pregnant’ in Japanese, and the name has been given to this candlestick pattern because it resembles a pregnant woman.
The second candle of this pattern should be contained within the body of the first candle.
In a downtrend a Bullish Harami candlestick pattern can indicate a reversal to uptrend whereas in an uptrend a Bearish Harami candlestick pattern can indicate a reversal to downtrend.
![bullish and bearish harami candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/bullish-and-bearish-harami-candlestick-e1696415551755.jpg)
- Doji Candlestick Pattern
A Doji candlestick represents an indecision between buyers and sellers in an underlying asset.
This Doji candlestick can possibly act as a reversal candle of a current trend.
This pattern can occur at the top of an uptrend, bottom of a downtrend or in the middle of a trend.
The body of this candlestick is formed between an upper wick and lower wick and the size of Doji candlestick is small.
![Doji candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/doji-candlestick-e1696415639388.jpg)
- Bullish and Bearish Engulfing Candlestick Patterns
Bullish and Bearish Engulfing candlestick is a reversal candlestick pattern.
Bearish Engulfing candlestick pattern is a small green candle followed by a larger red candle engulfing the small green candle. This shows that bears are stronger than bulls.
Bullish engulfing candlestick pattern is a small red candle followed by a larger green candle engulfing the small red candle. This shows that bulls are stronger than bears.
![Bullish and Bearish Engulfing Candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/Screenshot-2023-10-04-154725.png)
- Three White Soldiers Candlestick Patterns
The three white soldiers pattern is a bullish candlestick pattern. It consists of consecutive long green candles with small wicks, which open and close progressively higher than the previous candles.
It is a strong bullish signal that occurs after downtrend and it shows a steady bullish buying pressure.
![Three White Soldiers Candlesticks](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/3-white-soldiers.jpg)
- Marubozu Candlestick Pattern
The name ‘Marubozo’ comes from the Japanese word for ‘close-cropped’, which means a candle with no shadow.
A Marubozu candlestick is a bullish or a bearish candlestick pattern which indicates a strong bullish or a bearish trend.
A Marubozu candlestick consists of no wicks at all which means that the price did not break though the low of a candle and closed at the highest price in that specific time period.
A Marubozu candlestick in a downtrend indicates a strong buying pressure and a possible trend reversal to uptrend.
A green Marubozu candlestick in an uptrend can indicate that buyers are aggressive in buying an asset and can continue its uptrend.
A red Marubozu candlestick in an uptrend can indicate a possible trend reversal.
A red Marubozu candlestick in a downtrend can indicate that sellers are aggressive in selling an underlying asset and can continue its downtrend.
These type of candlestick patterns can help a trader to capture a major upcoming move.
![Marubozu Candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/Marubozu.jpg)
- Tweezer Top Candlestick Pattern
Tweezer Top candlestick is a combination of two candles. It is a bearish candlestick pattern or a reversal pattern. The combination of these candlesticks have the same high.
Tweezer Top in a bullish trend can indicate a bearish trend reversal. This means that sellers are interested at higher prices and are gaining control over price.
![Tweezer Top Candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/tweezer-top.jpg)
- Tweezer Bottom Candlestick Pattern
Tweezer Bottom Candlestick is also a combination of two candles. It is a bullish candlestick pattern or a reversal pattern. The combination of these candlesticks have the same low.
Tweezer bottom in a bearish trend can indicate a bullish trend reversal. Which means that buyers are interested at lower prices and are gaining control over price.
![Tweezer Bottom Candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/tweezer-bottom.jpg)
- Dark Cloud Cover Candlestick Pattern
Dark Cloud candlestick is a bearish reversal candlestick pattern. This candlestick should form in an uptrend.
Dark Cloud Cover opens above the high of the first candle and closes below the midpoint of the first candlestick body.
![Dark Cloud Cover Candlestick](https://www.bhomiiksoan.com/wp-content/uploads/2023/10/Screenshot-2023-10-04-155400.png)
Conclusion
In the end I would conclude this article by saying that even though candlestick patterns play an important role in the world of technical analysis, mastering the price action and combining candlestick patterns with demand and supply areas will increase the accuracy of your analysis.
Remember that constantly working on yourself with proper discipline will make you profitable in the long run in stock market.