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Types of Candlestick Pattern

The document describes various candlestick patterns that indicate bullish and bearish sentiment in the market. Bearish patterns like hanging man, shooting star, bearish harami, and bearish engulfing typically occur at the end of uptrends and signal a potential trend reversal. Bullish patterns like hammer, inverted hammer, bullish harami, and bullish engulfing usually happen at the bottom of downtrends and suggest the trend may become bullish again. The piercing pattern also signals a reversal from a downtrend but involves only partial engulfing of the previous candle.

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07 Bhavesh Jagtap
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2K views2 pages

Types of Candlestick Pattern

The document describes various candlestick patterns that indicate bullish and bearish sentiment in the market. Bearish patterns like hanging man, shooting star, bearish harami, and bearish engulfing typically occur at the end of uptrends and signal a potential trend reversal. Bullish patterns like hammer, inverted hammer, bullish harami, and bullish engulfing usually happen at the bottom of downtrends and suggest the trend may become bullish again. The piercing pattern also signals a reversal from a downtrend but involves only partial engulfing of the previous candle.

Uploaded by

07 Bhavesh Jagtap
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Types of Candlestick Pattern

Bearish Bullish
• Hanging man : A Hanging man is a • Hammer : Hammer is identical in
candlestick pattern with a long wick shape to hanging man but the
below the candle's body. The difference is that while hammer
length of the body is usually 1/3rd occurs in a downtrend. The
of the length of lower wick. hanging man pattern occurs in an
uptrend.
• Shooting Star : Shooting star is • Inverted Hammer : An Inverted
simply an inversion of the hanging Hammer is usually observed at
man pattern. It has a small body &a the end of a downtrend. This
long wick above it, with little to no pattern is similar to shooting star
wick below. Shooting star is usually & differs only in the position
observed in an uptrend & signifies where it occurs.
trend exhaustion.
• Bearish Harami : In a Bearish • Bullish Harami : In a Bullish
Harami, 1st candle is a bull candle Harami, 1st candle is a bear
& 2nd candle is a bear candle. candle & the 2nd candle is a bull
Bear candle has small body candle. Bull candle has a small
compared to Bull candle. body compared to bear candle.
• Bearish Engulfing : A Bearish • Bullish Engulfing : A Bullish
engulfing pattern is generally engulfing pattern is generally
observed at the end of an observed at the end of a
uptrend. A large red candle downtrend. A large green candle
engulfs a small green candle engulfs a small red candle
showing the strength of bears. showing the strength of bulls.
Prior Bullish trend converts to Prior Bearish trend converts to
Bearish trend. Bullish trend.
• Piercing Pattern : A Piercing pattern is similar to
bullish engulfing pattern in a way that both of
them appear near the end of a downtrend. But the
green candle doesn't engulf the red candle
completely instead closes half way through it.

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