Category: Candlesticks

Doji is a japanese word that means blunder, or mistake. In trading, it refers to a candlestick with an identical, or virtually identical, open and close price. Perhaps the Japanese considered it a blunder by the market to have an entire trading session with no meaningful result. For technical traders,…

The spinning top candlestick pattern is a variation of the doji candlestick. But in addition to meeting the criteria for the doji candle, a spinning top features a candle body located in the center of the trading range. Another name for this candle is the long-legged doji. Because this candle…

The harami candlestick pattern depicts price struggling to break out in either direction during a trend. Traders often call it this occurrence an “inside day” or “inside bar” instead. So where did the name harami come from? The Japanese say “harami” to mean pregnant. In Urdu, it means illegitimate child.…

The hanging man is a single candle pattern with the same shape as the hammer. It gets its name from the fact that it has a candle body near the top and a long lower wick, resembling a man hanging in the air. Knowing this, you can probably guess where…

The gravestone doji, or shooting star, is a single candle pattern that resembles the inverted hammer. Traders may refer to it simply as the “gravestone”, but I will refer to it as gravestone doji throughout this article and others. If this candle appears after an extended bullish run, it is…

The inverted hammer candlestick is a single candle pattern in which the candle forms an upside-down “T”. If the body of the candle is so small that it has the same open and closing price, the term doji can apply. Traders refer to this candle with other names, such as…

The hammer candlestick is a single candle pattern in which the shape of the candle resembles a “T”. Its name can vary depending on where the candles appears and small variations in its shape. If it takes place after an extended selloff, traders call it a hammer, or a dragonfly.…

The bearish engulfing is a candlestick pattern that technical traders use to identify an area of weakness. It involves a pair of candles, in which the second candle serves as a signal for technical traders to open a short, or close a long, right before the market begins selling off.…

The bullish engulfing is a candlestick pattern that technical traders use as a buy signal. It involves a pair of candles that show a sudden rise in buying pressure. Technical traders use this as a clue to open a long, or close a short, anticipating a bullish run. What does…