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Engulfing Candle

Understanding Bullish Engulfing Candlestick PatternThe Bullish Engulfing Candlestick Pattern is a popular price action signal used by traders to identify potential trend reversals in the market. If you're keen on mastering price action trading, understanding this pattern is essential. This guide will take you from the basics of the pattern to advanced insights, with easy-to-understand explanations to help you become more confident in your trading decisions. What is a Bullish Engulfing Candlestick? A bullish engulfing candlestick is a two-candle pattern that signals a potential reversal in a bearish trend. The pattern consists of a smaller bearish (red) candle followed by a larger bullish (green) candle that completely engulfs the previous one. This indicates that the buying pressure has overwhelmed the sellers, suggesting a shift from a downtrend to an uptrend. Key Features of the Bullish Engulfing Pattern Here’s a breakdown of the key characteristics: Number of Candles: The pattern consists of two candles. First Candle: A bearish candle, typically red, showing a decline in price. Second Candle: A bullish candle, typically green, that completely engulfs the previous bearish candle, including its wicks. Prior Trend: A bearish trend must precede the pattern to validate it as a potential reversal signal. Prediction: A potential shift from bearish to bullish trend. The Anatomy of a Bullish Engulfing Pattern To fully grasp this pattern, let's break down the structure: The first candle in the pattern is a small bearish candle, indicating the continuation of a downtrend. The second candle is a large bullish candle that opens lower than the previous close and closes higher than the previous high, completely engulfing it. This suggests a strong buying momentum. Why Do Bullish Engulfing Patterns Work? A bullish engulfing pattern is significant because it reflects a shift in market sentiment. Here’s why: Seller Exhaustion: The first candle shows a bearish trend, indicating seller dominance. When the second candle engulfs it, it suggests that sellers are losing control. Buyer Strength: The second candle’s larger body signals strong buying interest, indicating a shift in market control from sellers to buyers. Market Psychology: A bullish engulfing pattern indicates that traders are willing to buy at higher prices, leading to increased bullish momentum. Why a Pin Bar Can Be an Engulfing Pattern A common observation among experienced traders is that a pin bar on a higher timeframe can appear as a bullish engulfing pattern on a lower timeframe. This happens because: A pin bar shows a strong rejection of lower prices, which on a lower timeframe looks like a large bullish candle engulfing smaller bearish candles. This highlights the importance of multi-timeframe analysis. Understanding how patterns form on different timeframes gives a more holistic view of market dynamics.
CAPITALCOM:GOLDEducation
by ForexBee
How to Spot and Trade the ENGULFING CANDLE Hey traders, In this post, we will discuss a classic candlestick pattern formation each trader must know - the engulfing candle. Key properties of this pattern: 🔑 Engulfing candle is a reversal pattern. 🔑 Engulfing candle can be bullish or bearish. ❗️Also, remember that this candle demonstrates the highest accuracy when it is formed on a key level (support or resistance). ⬆️Bullish Engulfing Candle usually forms after a strong bearish impulse. Weakening, the market keeps going lower forming bearish candles. However, at some moment, instead of forming a new bearish candle the market reverses. The price forms a bullish candle that engulfs the range of the previous bearish candle and closes above its opening price. Such a candle we call a bullish engulfing candle. The main feature of this pattern is the fact that its total range (distance from the wick high to wick low) & body range (distance from body open to body close) exceed the ranges of a previous bearish candle. Being formed on a key support level or within a demand zone it signifies a highly probable pullback or even a trend reversal. ⬇️Bearish Engulfing Candle usually forms after a strong bullish move. Reaching an overbought condition, the market keeps going higher forming bullish candles. However, at some moment, instead of forming a new bullish candle the market goes in the opposite direction. The price forms a bearish candle that engulfs the range of the previous bullish candle and closes below its opening price. Such a candle we call a bearish engulfing candle. The main feature of this pattern is the fact that its total range (distance from the wick high to wick low) & body range (distance from body open to body close) exceed the ranges of a previous bullish candle. Being formed on a key resistance level or within a supply zone it signifies a highly probable pullback or even a trend reversal. Take a look how powerful the engulfing candle is: on Gold chart, 4H time frame, the price formed a bullish engulfing candle after a pullback. The formation of the pattern immediately triggered a bullish continuation. At some moment, the market became overbought, the formation of a bearish engulfing candle confirmed the initiation of a bearish movement and the market dropped heavily then. 📝Engulfing candle can be applied for scalping lower time frames, for intraday trading, or even for swing trading. Personally, I apply this candle on daily/4h time frames as one of the confirmations of the strength of the structure level that I spotted. Let me know, traders, what do you want to learn in the next educational post?
OANDA:XAUUSDEducation
by VasilyTrader
10
Mastering Engulfing Candle Trading 📚Engulfing candles are an essential feature of technical analysis in forex trading. An engulfing pattern happens when a larger candle engulfs the entire body of the previous candle, signaling a potential reversal of the current trend. Engulfing candles, which can be either bullish or bearish, are trusted by many traders for their reliability in predicting future price movements. However, to become an expert in engulfing candle trading, one needs to learn how to identify the best ones and leverage their body size effectively. In this article, we will look at the crucial steps to master this trading strategy. 🔎Identifying the Best Engulfing Candles One of the key aspects of trading using engulfing candles is knowing how to spot the strongest signals. The best engulfing candles should be resistant to the noise and inconsistent movements that can often occur in the forex market. The first step towards identifying the best engulfing candles is to focus on the size of the preceding candles. Candles with small bodies and long wicks produce too much noise and can lead to false signals. Instead, seek engulfing candles that develop after a significant price move, ideally with a larger body and shorter wick. Higher timeframe charts - like the 4-hour and daily - offer better accuracy in identifying reliable engulfing patterns. 💪Leveraging Body Size for More Efficient Trading The size of an engulfing candle’s body plays a crucial role in determining the strength of a trend. A larger body indicates more significant price movement and more active participation from traders. The size of the engulfing candle can also help ascertain the potential strength of the new trend. Bigger body sizes usually signal a stronger trend, whereas smaller bodies usually represent a more moderate price move. Traders can leverage body size to adjust their trading strategy – for instance, employing wider stop losses for more significant movements or using tighter take profit targets for moderate trends. I have collected couple of good engulfing candles that we were trading with our team. Take a closer look at their body sizes and the previous candles. Such candles alone can provide fantastics trading opportunities. 🔔Conclusion Engulfing candles are an essential tool in forex trading, and their size can significantly help traders identify the best entry signals. Traders who master engulfing candle trading can develop a more accurate technical analysis strategy that yields high returns. By continually analyzing candlestick patterns and using other technical analysis tools, traders can build robust investment strategies that enable them to become profitable forex traders. What do you want to learn in the next post?
TVC:GOLDEducation
by UnitedSignals
9
Stochastic + RSI + MACD zero cross strategy from backtest on SPYStrategy 1. Stochastic cross at 50 level 2. RSI cross at 50 level 3. MACD cross at 0 level 4. Engulfing Candlestick? 5. Level 2 Tape sentiment balance (Optional) Technical Analysis It's a simple technical analysis setup strategy for bullish or bearish trading setup in both bullish and bearish sentiment scenarios. All levels in the indicators are at standard default settings. Step One: Look at the Stochastic indicator cross at 50 level and a cross over the signal line. This will be the first check and we want the cross to occur at the 50 level. Step Two: Check the RSI and need a cross at 50 level. This is the second confirmation. Step Three: Check the MACD cross and it's best to wait for the cross to happen at the zero line. This has a lower instances from occurring but it helps to avoid fake-outs that MACD is prone to showing. Step Four: Look for an engulfing candlestick pattern in the chart for a final confirmation. Step Five (Optional): If you have access to Level II quotes and the Time&Sales, watch for a momentum into the Ask side for a bullish sentiment or the Bid side for a bearish sentiment. Also you'll need to be familiar with tape reading on the volume and speed for better entry or exit.
AMEX:SPYEducation
by ashpat86
THE ENGULFING CANDLE LIQUIDITY EntrySo let's learn something about engulfing candles entries. An engulfing candle is usually a momentum candle and in most cases signifies reversal and at times trend continuation. Now what you do is plot your fib on the engulfing candle from wick to wick and mark the 40-50% retracement area which becomes a potential supply liquidity zone to sell from a bearish engulfing and a demand liquidity zone to buy from a bullish engulfing. In short 90%+ of the time price will retrace back to these zones before continuing and can thus provide clean and safe entries with reduced drawdown, lower risk and a good risk to return. Try it
Education
by JayForexAcademy
1
Tug of War Among Central BanksThere is a tug of war situation among the central banks to hike interest rates. What is the bad and the good that will come out from this? i. Last week of October, European Central Bank officials announced another massive 75 basis point hike, increasing interest rates at the fastest pace in the history of the euro currency. ii. This week, the Federal Reserve is expected to increase rates by 75 basis points for the fourth time in a row. iii. The Bank of England could join the club on Thursday. Content: . The Interest Rate race has just started, why? . The impact on different currencies . It may not be all bad news, why? With higher interest rates, it attracts investors to buy its currency, in this case the USD. Currency is always a pair, when USD strengthens, the other side weakens. When a currency gets weaker, it is very bad news for inflation because they will have to pay more on their imports. Therefore in order to counter inflation, one of the best measures is to hike rate Expect more volatility in the currencies market, meaning currencies will take its turn to move. And if you are a trader, you should welcome volatility. Because with volatility, there are opportunities. GBP Futures 0.0001 = $6.25 0.001 = $62.50 0.01 = $625 0.1 = $6,250 1.1000 to 1.2000 = $6,250 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
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CME:6B1!Education
by konhow
77
[Candlestick Patterns] Just need to know these three!#Candlestick #CandlePattern #Tocademy #Tutorial Hello traders from all over the world, this is Tommy =) I was unexpectedly surprised by many of you who liked and supported my last post about the basic concept of TA(Technical Analysis). Today I prepared a brief lecture about the Candlestick Pattern, one of the most fundamental phenomenon and behaviors that traders must be well-informed. In fact, we should be very familiar with these textbook contents and interpret it in a glimpse on the technical chart unconsciously. Just like we don't pay direct attention about each breathes when breathing, like we don't care each and all of the alphabets when we speak, or like we don’t perceive location of each keyboards every moment as we type, this very technique should be performed automatically and quickly by observing dominant formations of candlestick bars. As a matter of fact, comprehending market trends and price actions only by referring to the candlesticks is yet too spurious. It should be used in such a way to weight on certain scenarios in a macroscopic view, rather than deriving precise and specific PRZ(Potential Reversal Zone)s and distinguish the accurate market trend. It’s never like ‘The price must go up because this pattern just appeared’. Furthermore, I strongly believe that the reliability of the candlestick pattern strategy is declining especially in recent financial market, where we encounter countless non-traditional and abnormal situations that were not very common in the past. Hence among the existing ‘Textbook’ candlestick pattern strategies that can easily be found on Google, there are particular patterns that are still very reliable on current market and there are ones that are not as reliable as it used to be. So here, I will organize everything very clearly for you guys. The technical chart is well known as sort of a map tracing the mob-psychology of all the stakeholders in the market. Investors’ sentiments such as FUD(Fear, Uncertainty, and Doubt) and FOMO(Fear of Missing Out) that often cause panic buy/sell are visualized as data. Those with a clear understanding of the fundamental nature of how candlesticks are being formed, don’t even need to memorize these patterns one by one. As I emphasized at my previous post, candlesticks should be interpreted as a whole structure, unlike the line chart expressed in one-dimensional. Candlesticks are newly formed in each time interval and we can choose the timeframe for the chart that we are about to analyze. For instance, each candlestick in a daily chart is formed every day while each candlestick in a 5minute chart is formed every 5 minutes. Higher the timeframe of the chart is, longer-term the scope within the chart is. It is important as a TA analyst to start from macro-perspective with higher timeframe first, then go deeper to lower timeframe and find short-term factors. There are four independent prices composing a candlestick: open, high, low and close price. Open price indicates the starting point while close price indicates the ending point of a candlestick. Just like the wording, high/low prices are formed at the highest/lowest price during the time period of candlestick being formed. A bullish candlestick is when the closing price is above the opening price (i.e., when the price rises), while a bearish candle is when the closing price is below the opening price (i.e., when the price is falling), and the two are expressed in different colors (green & red or red & blue). The thick part between the opening and closing price is called the ‘Body’, and the thin part is called the ‘Tail’ (Wick or Shadow). Typically, the length of the body implies the strength of an ongoing trend. We learned from the textbook that the candlesticks with a longer body means stronger trend and those with shorter tails mean clearer trend. Back in the days, there was time when we could detect if whales are involved and deduct impulsiveness of ongoing trend when distinctly long bodied candlesticks with relatively high trading volumes take places. I am afraid to tell you that it is better to erase that memory. First of all, it is too obvious and cliché to announce that the long candlesticks with high volumes mean strong market trend. This criterion itself is quite vague and not 100% reliable to identify future trends or find insightful signals. Moreover, in recent days (especially in Crypto), whales like to deceive retail traders with a strong faith of trading volumes and since the future markets are becoming bigger, giving too much weight on trading volume paired to each candlestick is not as effective as it was when textbook used to work very well. I am not saying textbook is wrong. It just needs slight updates since the market we are dealing with keeps changing over time. In TA world, closing price of a candlestick carries a great meaning and thus closing prices at higher timeframes should very well be monitored to become a successful trader. Sometimes whales even battle aggressively right before a major closing time often causing a weird ‘scam’ moves with a high volume. As shown below, we usually find the price and time when certain TA variables (such as top/bottom of trendline, channels, pivot levels, and other indicators) are broken, meaning if the price has penetrated those variables successfully, in order to find breakout entries, stoplosses, and target prices, etc. This whole concept of breaking above or below is quite vague, subjective, and relative idea. So, what we traders refer to as a reliable criterion is confirming whether the candle closed above and below the factors. For instance, let’s say that we are seeking and waiting for the breakout of the downward trendline. Well sometimes it’s not as easy as expected to precisely spot and determine whether the price has successfully pierced through the trendline. There are times when price breaks the trendline, but ends up coming back below leading close price of the candlestick to be formed below the trendline like the case 2 below. In this very case, it’s difficult to determine whether the breakout happened successfully or not. Nevertheless, like case 3, when both closing and high prices are formed above the trendline, we can clearly confirm and weight more on the breakout scenario, expecting more bullish rally. Okay let's get to the point. In recent financial trading market, it's enough to know just these three. 1. Engulfing 2. Doji 3. Long Tailed Candlestick As mentioned above, there’s nothing hard if you understand the essential concepts and principles of the above patterns and phenomena. The engulfing candlestick is a phenomenon in which the body of the previous candle is consumed by the body of the next candle, that is, a larger body than the previous one comes out. In other words, if a new bullish candle closes higher than the previous open price or if a new bearish candle closes lower than the previous open price, we say ‘the new candlestick engulfed the previous one’. If we look closely, this pattern implies the circumstance where the new candle completely overwhelms the trend of the previous candle and reverses it into a new trend despite closing the price from above or below. However, the appearance of an engulfing candle does not mean that the trend is unconditionally reversed. It is often the case that engulfing candles take place consecutively, with the second candle taking over the body of the first candle, the third’s taking over the second’s, the fourth’s taking over the third’s and so on. As the price fluctuates up and down, it creates a Widening or Broadening pattern also known as expanding sort of shapes, making it difficult for traders to figure out the current trend. In this circumstance, the entry prices, stop loss prices, target prices, or average prices of many participants in the market tend to be located relatively nearby. This price range or region is called a HVP(High Volume Profile or Peak) or an Orderblock and I will cover details about this concept later on another post. Anyway, there are numerous methods to derive Orderblock and one of them is to spot bodies of the consecutive engulfing candlesticks. The tail(wick) of a candlestick can be interpreted as a sign of the fierce battle between the bulls are bears. Longer tail signifies bigger collision between buying and selling forces. The longer the upper tail, the more the bulls trying to raise the price up but the bears rejecting them eventually sellers ending up being dominant and vice versa for the longer the lower tail. Generally, when the long upper/lower tails are formed at a relative higher/lower part of the wave structure or at a distinctive pullback as a PRZ this can be a possible signal of trend reversal. Due to my personal trading experience, it doesn't matter much in recent TA market whether the long-tailed candlestick is a bullish or bearish. In other words, regardless of the color of Hammer or Shooting star (which are both long-tailed candlestick pattern), it’s better to check if the next following candlesticks are being formed opposite direction of the tail. Personally, I don't think the Inverted Hammer and Hanging Man are not as necessary as it used to be in the old days. When the length of the candlestick’s body is relatively short meaning if the open and close prices are very close, forming a cross like shape, it’s called a Doji. Since Doji has a short body, the upper and lower tails tend to come out longer and thus can be considered as evidence of a tense confrontation between the bulls and bears that eventually ends up reaching a balance. Similar to the long-tailed candlestick, Doji is also known as a sign of a PRZ depending on the next appearing candlesticks. When Dojis are observed after swing high or low, it can be a possible indicator that the on-going trend is overheated and you might want to anticipate some pullbacks. However, it is too risky to directly assume that the top or bottom is near just because of Doji. Especially in the market these days, Dojis also appear frequently in sideways and sometimes confuses traders searching for a clear trend. As emphasized above, as with other technical techniques, theories, and indicators, always remember to weight more to the emergence of patterns in higher timeframes and longer-term perspectives. The higher timeframe people globally refer to, the more the reliability the TA will be. Just think about it for a second. Which timeframe do you think that people consider more significantly about the closing price, a 5 minutes chart or a daily chart? I would obviously say that the price signals from the daily cart is relatively more representative and reflect longer-term than those of the 5 minutes chart. Keep in mind is that you also need to understand market trends from a macro perspective before approaching towards short-term perspective. It is always recommended to recognize long-term trends or situations in advance from the candlestick of a higher timeframe, and then look at more detailed and microscopic elements step by step. All right. I will wrap up now. Thanks for reading my post. Your subscriptions, likes, and comments are a huge inspiration for me to write more posts!
BITMEX:BTCUSD.PEducation
by Tommy_Trader
20
Engulfing Candlestick PatternEngulfing candlestick is formed when it completely engulfs the previous more than one candle but be considered an engulfing candlestick pattern because in Engulfing at least one candle must fully engulf. Types of Engulfing Candlestick Pattern Bullish Engulfing Pattern Bearish Engulfing Pattern #1 Bullish Engulfing Pattern Bullish Engulfing pattern consists of two candle formations, the first candle is the small body and the second candle is the bigger. The second big candle should be fully engulfed than the previous small candle. This is called the bullish engulfing pattern. #2 Bearish Engulfing Pattern Bearish Engulfing pattern consists of two candle formations, the first candle is a small Bullish candle and the second is the bigger bearish Candle than the previous bullish candle. The Second big bearish candle should fully engulf the previous one or more small candles. This is called a bearish engulfing pattern.
NSE:BANKNIFTYEducation
by the_dileepkumar
ENGULFING CANDLE. Powerful reversal candlestick pattern🕯 ✅Candlestick patterns trading is one of the oldest but most effective ways to analyze the foreign exchange market. The trader needs to find certain patterns, and based on them, decide where the price will go. Today we will talk about one of these candlesticks, which is called the "engulfing candle". There are two types of it: bullish and bearish. The appearance of such a model on the chart with a high probability indicates a possible reversal of the trend and is a signal to enter the market. Types of engulfing and their features ⚠️So, we realized that there are two types of this candle: 🟢Bullish. It indicates that the trend is turning towards an increase in the value of an asset or currency pair. The candle must engulf the range of the previous bearish candle to be valid. 🟢Bearish. The same as with bullish, only the opposite. It indicates that the trend is turning towards a decrease in the value of the asset. In this case, the candle must engulf the range of the previous bullish candle. ✅The formation of the "Bullish engulfing" candle says that buyers have sat on the throne, and "Bearish" - sellers. Let's discuss the theoretical foundations of the pattern. In the case of the "bullish engulfing" pattern, everything will be the same, just the opposite. Rules for the formation of the "bearish engulfing" pattern: There should be a bullish trend in the market, and the price should be on a key level. ❗️A long-bodied bullish candle appears (that is, directed towards the trend). The opening of the second candle should be carried out with a gap relative to the closing of the first, and its body should be larger than that of the previous one. It seems to engulf the trend with its dimensions, and therefore it is necessary to sell (a bearish candle indicates the beginning of a downward trend). ❤️ Please, support our work with like & comment! ❤️
Education
by UnitedSignals
6
What are candlesticks in trading and how to use them?🕯 ✅The price dynamics of an asset are displayed on the chart in different formats, including bars, lines, or candles. The latter format is most popular among traders and is often used in technical market analysis. What are candles and how to work with them? 🟢Candlesticks (Japanese candlesticks) are a graphical way of displaying price dynamics, in which vertical rectangles and lines are used. This method was invented on the rice exchanges of Japan in the 17th century, from where it got its name. A price candle consists of two main elements: 1️⃣the body is a vertical rectangle that shows the opening and closing levels of trades; 2️⃣wicks (shadows, tails) - vertical lines from above and below the body of the candle, reflecting fluctuations in value in the interval between opening and closing. ❗️The main advantage of a candle over bars and a linear chart is that it allows you to get 4 important indicators for technical analysis at once: High - the highest price for the period; Low - the lowest price for the period; Open - the opening price of the period; Close - the closing price of the period. 🔴When using a linear graph to get the same information, 4 indicators would have to be displayed on the screen at once, which is inconvenient and complicates the perception of information. At the same time, candles display the process of cost formation in a specific time interval, so the position and appearance of candles on the hourly and daily periods will differ significantly Types of candles ⚠️Two main types of candlesticks correspond to market trends: Bullish candle - formed when the closing price of the period was higher than the opening price. On the chart, such a candle is displayed in green (on b / w - white) and indicates the victory of buyers in this time. A bearish candle - is formed if the period is closed at a price lower than it was opened. On the chart, bearish candlesticks have a red color (on b / w - black) and they show that sellers are dominating at the moment. ❤️ Please, support our work with like & comment! ❤️
Education
by UnitedSignals
15
CANDLESTICK PATTERNS BASICS | Engulfing Candle 📚 Hey traders, In this educational post, I want to discuss with you one of the most accurate REVERSAL candlestick patterns - the engulfing candle. On EURUSD chart, I spotted for you bullish & bearish examples of this pattern. The logic behind this pattern is quite simple: ⭐️In a bullish trend, after a strong directional movement, the price reaches some important structure level. Growing steadily and forming a sequence of green bullish candles the price suddenly forms a strong bearish candle. What is particular about that candle is the fact that its total range (distance from the wick high to wick low) & body range (distance from body open to body close) exceed the ranges of a previous bullish candle. 🔻Such a candle we will call a bearish engulfing candle. Most of the time it signifies a strong spike in selling volumes and willingness of sellers to push. With a high probability, such a formation leads to a pullback or even a trend reversal. ⭐️In a bearish trend, after a strong short rally, the price reaches some demand cluster. Instead of breaking that and going lower, the price forms a strong bullish candle. That candle engulfs the range of the previous bearish candle & its body size exceeds the size of the previous candle. 🟢Such a candle we will call a bullish engulfing candle. Quite often such a formation leads to a pullback or even a trend reversal. 🔔And there is just one single tip that will dramatically increase your performance trading the engulfing candle: It is recommended to rely on this pattern ONLY IF it is formed on a key level: ❗️Bullish engulfing candle must strictly form on a strong support. ❗️Bearish engulfing candle must strictly form on a strong resistance. Forming beyond key levels, the pattern occasionally will give false signals. ⏳Preferable time frames to trade engulfing candles are daily/4h. Learn to spot this pattern & you will see how efficient it is. What candlestick patterns do you want to learn in the next posts? ❤️Please, support this post with like and comment!❤️
Education
by VasilyTrader
28
SIMPLE PRICE ACTION STRATEGY! PART 1RULE NO 1: Use S&R Levels As Well As The SUPPLY & DEMAND ZONES. RULE NO 2: Look For BULLISH ENGULFINGS In The UP TREND TREND 2: PIN BAR CANDLE 3: BULLISH HAMMER AND Look For BEARISH ENGULFING In The DOWN TREND 2: SHOOTING STAR 3: BEARISH PIN BAR NOTE: Use These Patterns on S&R , Supply And Demand Zones Break Of Structure Etc. 3RD RULE USE 4H TIMEFRAME IF YOU WANT TO LEARN IT FROM ME ASK ME IN COMMENTS I WILL TELL YOU HOW TO UNDERSTAND MARKET STRUCTURE EASILY ! USING TOO MUCH INDICATORS CAN LEAD YOU TO A HUGE LOSS. This Is Not An Investment Advice. HOPE YOU CAN UNDERSTAND! HAVE A NICE TRADING JOURNEY !
Education
by SarimAaraiz
3
Let's talk about Candlestick Chart PatternsThe candlestick chart patterns are used by traders to set up their trades, and predicting the future direction of the price movements. There are many candlestick chart patterns. I will be discussing a few of those. ✅ Morning Star is formed after a downtrend indicating a bullish reversal. Generally made of 3 candlesticks, first being a bearish candle, second a Doji, and third being a bullish candle. The first candle shows the continuation of the downtrend, the second being a Doji shows indecision in the market and the third bullish candle shows that bulls are back in action. ✅ Bullish Hammer is a single candlestick pattern, which is formed at the end of the downtrend and shows bullish reversal. The real body of this candle is small with a long lower wick which should be more than twice the real body. This candle is formed when the seller pushes the price downwards but at the same time buyers arrive and push the prices up. ✅ Bullish Engulfing is formed after a downtrend, indicating a bullish reversal. It is formed when a bearish candle is fully engulfed by a bullish candle which shows that the bulls are back in the market. ✅ Three White Soldiers is a multiple candlestick pattern that is formed after a downtrend indicating a bullish reversal. It is formed when three consecutive bullish candles appear one after the other. These three candles show a strong bullish trend. ✅ Hanging Man is generally formed at the end of an uptrend and signals bearish reversal. The real body of this candle is small and is located at the top with a lower shadow which should be more than twice the real body. This candlestick pattern has no or little upper shadow. ✅ Dark Cloud Cover is formed by two candles, the first candle being a bullish candle which indicates the continuation of the uptrend. The second candle is a bearish candle that opens the gap up but closes more than 50% of the real body of the previous candle which shows that the bears are back in the market and a bearish reversal is going to take place. ✅ Bearish Engulfing is formed by two candles, after an uptrend indicating a bearish reversal. It is formed by two candles, the second candlestick engulfing the first candlestick. The first candle being a bullish candle indicates the continuation of the uptrend. The second candlestick chart is a long bearish candle that completely engulfs the first candle and shows that the bears are back in the market. ✅ Evening Star is made of 3 candlesticks, first being a bullish candle, second a Doji, and third being a bearish candle. The first candle shows the continuation of the uptrend, the second candle being a doji indicates indecision in the market, and the third bearish candle shows that the bears are back in the market and reversal is going to take place. Thanks for reading and hope you like it. Please comment and let us know your thoughts on it. Happy Trading
Education
by Tuned_Official
How to use Candlestick Patterns ..Hello Traders , Have a nice weekend. it's good to learn something even if you knew it before,Seriously some of you know all these patterns but don't know how to use them. First we have to draw our support and resistance area in higher time frames , then we switch to lower time frames to see a candlestick pattern and now you can enter the trade after a little price rest to have a better RR ratio guys. Good Luck on that , As easy as you see
Education
by sajadakrami1378
Bull or bear beat holding +249.2% over a year, in profit in MayAs traders we look to capitalise on all sort of markets, not just parabolic runs. Today we are exploring how to run a long strategy even when the bulls are not in control. WILL POST LAST 50 POSITIONS BELOW We are looking for an strategy that: 1. has been beating buy and hold all year 2. Has a drawdown of max 15% in may 2021 3. Is simple to execute and automate Not all candlestick patterns are created equal, and they do not work on all markets. However they do work in crypto, at least based on experience as they are not tough to identify and speculators tend to react to them. This is why we focused on candles that are not that difficult to identify and are very clear in meaning. The strategy (FULL INSTRUCTIONS): On the 30 min timeframe: We are going to open a position when the candle is a bullish Engulfing We are going to close the position when the candle is bearish Marubozu No stop loss or take profit, these are the only rules we follow, but we follow them a 100% of the time. The results: The strategy brought in 249.17%, beating holding. If you started trading this a year ago with 1 Bitcoin, you would be 2.4917 BTC in profit at the moment. What's even better the max drawdown throughout the year was 22.7% and it was actually in February. During May we were only 11% down at a certain point. This provides a Sortino Ratio of 5.44 which is a stellar mark for these volatile markets. The positions: 31/05/2021 04:30 31/05/2021 14:00 10 hours OP 0.06681 CP 0.068884 +3.1% 29/05/2021 21:30 30/05/2021 19:30 22 hours OP 0.065407 CP 0.067746 +3.58% 29/05/2021 00:30 29/05/2021 18:00 18 hours OP 0.068427 CP 0.066952 -2.16% 28/05/2021 07:30 28/05/2021 14:30 7 hours OP 0.069574 CP 0.069572 -0.00287% 25/05/2021 18:00 27/05/2021 19:30 2 days OP 0.068144 CP 0.071024 +4.23% 24/05/2021 00:30 25/05/2021 03:30 1 day OP 0.061435 CP 0.067043 +9.13% 22/05/2021 22:30 23/05/2021 12:30 14 hours OP 0.062197 CP 0.0581 -6.59% 22/05/2021 11:00 22/05/2021 17:30 7 hours OP 0.064251 CP 0.06059 -5.7% 19/05/2021 22:00 20/05/2021 21:00 23 hours OP 0.066705 CP 0.068997 +3.44% 17/05/2021 23:00 19/05/2021 07:00 1 day OP 0.075193 CP 0.074787 -0.54% 17/05/2021 06:30 17/05/2021 09:30 3 hours OP 0.076593 CP 0.077412 +1.07% 14/05/2021 13:00 15/05/2021 14:30 1 day OP 0.079504 CP 0.078525 -1.23% 13/05/2021 16:30 13/05/2021 23:30 7 hours OP 0.076788 CP 0.074242 -3.32% 12/05/2021 10:30 13/05/2021 15:30 1 day OP 0.075732 CP 0.075619 -0.149% 11/05/2021 06:30 12/05/2021 10:00 1 day OP 0.071125 CP 0.075353 +5.94% 09/05/2021 16:00 10/05/2021 11:00 19 hours OP 0.06759 CP 0.069748 +3.19% 07/05/2021 13:30 09/05/2021 00:30 1 day OP 0.061147 CP 0.065733 +7.5% 05/05/2021 01:30 06/05/2021 23:30 2 days OP 0.061121 CP 0.061832 +1.16% 03/05/2021 00:30 04/05/2021 22:00 2 days OP 0.05225 CP 0.061328 +17.4% 01/05/2021 22:30 02/05/2021 05:30 7 hours OP 0.051064 CP 0.051111 +0.092% 30/04/2021 19:00 01/05/2021 15:00 20 hours OP 0.048829 CP 0.049703 +1.79% 30/04/2021 09:30 30/04/2021 16:00 7 hours OP 0.051113 CP 0.047849 -6.39% 29/04/2021 08:30 30/04/2021 02:30 18 hours OP 0.050351 CP 0.051114 +1.52% 28/04/2021 10:00 29/04/2021 00:30 15 hours OP 0.04799 CP 0.049829 +3.83% 27/04/2021 00:00 27/04/2021 19:30 20 hours OP 0.046896 CP 0.047795 +1.92% 26/04/2021 10:00 26/04/2021 13:00 3 hours OP 0.046466 CP 0.046378 -0.189% 24/04/2021 21:00 25/04/2021 13:30 17 hours OP 0.045035 CP 0.046231 +2.66% 22/04/2021 20:00 24/04/2021 17:00 2 days OP 0.04791 CP 0.044796 -6.5% 19/04/2021 12:00 22/04/2021 18:00 3 days OP 0.039343 CP 0.04728 +20.2% 16/04/2021 10:30 17/04/2021 19:00 1 day OP 0.03943 CP 0.039117 -0.794% 15/04/2021 18:00 16/04/2021 05:00 11 hours OP 0.039286 CP 0.039291 +0.0127% 13/04/2021 17:30 15/04/2021 17:00 2 days OP 0.0363 CP 0.039141 +7.83% 13/04/2021 14:30 13/04/2021 17:00 3 hours OP 0.03575 CP 0.035968 +0.61% 12/04/2021 11:00 12/04/2021 12:30 2 hours OP 0.035761 CP 0.035598 -0.456% 11/04/2021 03:30 12/04/2021 09:30 1 day OP 0.035639 CP 0.035866 +0.637% 10/04/2021 21:00 10/04/2021 23:30 3 hours OP 0.035761 CP 0.035688 -0.204% 08/04/2021 22:30 09/04/2021 13:30 15 hours OP 0.035729 CP 0.035448 -0.786% 08/04/2021 02:00 08/04/2021 18:30 17 hours OP 0.035231 CP 0.035636 NA +1.15% 05/04/2021 05:30 06/04/2021 19:30 2 days OP 0.035409 CP 0.036274 +2.44% 02/04/2021 13:00 04/04/2021 03:00 2 days OP 0.033704 CP 0.035098 +4.14% 01/04/2021 13:30 02/04/2021 04:00 15 hours OP 0.032793 CP 0.033349 +1.7% 30/03/2021 06:30 31/03/2021 22:00 2 days OP 0.03138 CP 0.032743 +4.34% 27/03/2021 09:00 30/03/2021 02:30 3 days OP 0.030822 CP 0.031326 +1.64% 26/03/2021 02:00 27/03/2021 04:00 1 day OP 0.03114 CP 0.030919 -0.71% 25/03/2021 16:00 25/03/2021 20:00 4 hours OP 0.031273 CP 0.030754 -1.66% 23/03/2021 17:30 23/03/2021 20:30 3 hours OP 0.030826 CP 0.03091 +0.272% 20/03/2021 15:30 23/03/2021 00:30 2 days OP 0.031261 CP 0.030839 -1.35% 20/03/2021 00:00 20/03/2021 05:30 6 hours OP 0.031174 CP 0.031295 +0.388% 18/03/2021 18:00 19/03/2021 03:30 10 hours OP 0.030665 CP 0.03087 +0.669% 17/03/2021 07:30 17/03/2021 18:00 11 hours OP 0.031816 CP 0.032216 +1.26%
Education
by CleoFinance
4
japanese candlestick patterns (engulfingbar bar)the engulfing bar: an engulfing pattern signals a reversal, and can be bullish or bearish. It comprises two candles. the body of the second one must engulf the body of the first one. There are two type of engulfing bars The bullish engulfing bar that cosists of two candles. the bosy of the second candle is greater in size than the previous candle. This pattern is considered to be reversal, because when it appears in a downtrend, it signals a revesal. The bearish engulfing candle consists also two candles, but it is the opposite version of the bullish engulfing bar . Be cause when it occurs in the end of an uptrend, it signals a future price reverse.
OANDA:XAUUSDEducation
by tradeplanprofit
2
Ultimate Candlestick Cheat Sheet For CryptoHello, traders! Here is the cheat sheet for the candlestick patterns. They are divided into five groups: -Bullish Reversal -Bullish Trend Continuation -Bearish Reversal -Bearish Trend Continuation -Neutral All these common formations you can see on the chart but first of all you should understand what has happened on the market. When you are looking at the candle a lot of useful information can be received. For example if the candle have the long wick to the downside and short body (hammer), it means a huge bullish pressure and this is a reversal to the uptrend sign. When you have three stars in the South formation it is can be noticed that the wicks to the downside are long and bodies became shorter. It means the weakness of the downtrend and also the sign of the potential reverse. If the candle have a very small body (doji) this indicates that the market is in indefinite situation. Bulls and bears war did not lead to price changes and future price direction is unknown. Do you use the candlestick patterns? Please write your comment and give us a support with like if you like such cheat sheets! DISCLAMER: Information is provided only for educational purposes. Do your own study before taking any actions or decisions.
Education
by Skyrexio
11
USDJPY With Several Evidences For A Potential Bottom FormationHello traders! Today we will talk about weekly USDJPY chart and we will show you many evidences for a potential bottom formation. Well, for the begining let's talk about wave structures from Elliott Wave perspective. USDJPY is in a downtrend since March, but the wave structure is slow, choppy and overlapped which we see it as a complex corrective W-X-Y decline and we know that once corrections fully unfolds, we can expect a reversal. The next very important evidence is an ending diagonal (wedge) pattern placed in third leg Y. The ending diagonal is a special type of wave that occurs in wave 5 of an impulse, or wave C/Y of a correction. This wave often occurs when the preceding move of the trend has gone too far, too fast and has run out of steam. An ending diagonal pattern is a type of pattern that can occur at the completion of a strong move. It reflects a “calming” of the market sentiment such that price still moves generally in the direction of the larger move, but not strongly enough to produce an impulsive wave. Ending diagonals consist of five waves, labeled 1-2-3-4-5, where each wave subdivides into three legs. Waves 1 and 4 overlap in price, while wave 3 can not be the shortest amongst waves 1, 3 and 5. The reason why they are so interesting is because they are indicating a reversal, usually a strong one. The next interesting evidence is that we are already seeing bounce and recovery with quite big weekly candlestick, completely covered the previous one, called bullish engulfing candlestick formation which also suggests a bullish reversal from the lows. If we also consider current break above strong weekly trendline, then with so many evidences, we can easily confirm a potential bottom and bullish reversal. Trade well! If you like what we do, then please like and share the idea! Disclosure: Please be informed that information we provide is NOT a trading recommendation or investment advice. All of our work is for educational purposes only.
Education
by ew-forecast
1
TOP 6 Candlestick PatternsHi, I would like to share my TOP 6 candlestick patterns, you can also name your TOP 3 in the comment section. Perfect scenario: identify the strong area, wait for the price coming inside of it, wait for a candlestick pattern which consists of at least two candles and it has to form in at least 1-hour timeframe (lower TF candlestick patterns are poor), wait for a pullback and GO. Always wait for a small pullback after the candlestick pattern has formed, you will get a better price. It is so rear case that after candlestick pattern formation the price goes immediately into the shown direction. MORNING STAR The Morning Star is a bullish bottom reversal pattern. It warns of weakness in a downtrend that could potentially lead to a trend reversal, especially if it forms on a strong support level. The morning star consists of three candlesticks with the middle candlestick forming a star. The first candlestick in the morning star pattern must be a red candlestick with a relatively large real body. The second candlestick is the star, which has a short real body that is separated from the real body of the first candlestick. The star does not need to form below the low of the first candlestick and can exist within the lower shadow of that candlestick. The star is the first indication of weakness as it indicates that the sellers were not able to drive the price close much lower than the close of the previous period. This weakness is confirmed by the third candlestick, which must be green in color and must close 50% above the body of the first candlestick. EVENING STAR The Evening Star is a bearish, top trend reversal pattern that warns of a potential reversal of an uptrend. It is the opposite of the Morning Star and, like the morning star, consists of three candlesticks, with the middle candlestick being a star. The first candlestick in the evening star must be green in color and must have a relatively large real body. The second candlestick is the star, which is a candlestick with a short real body that does not touch the real body of the preceding candlestick. The star can also form within the upper shadow of the first candlestick. The star is the first indication of weakness as it indicates that the buyers were unable to push the price up to close much higher than the close of the previous period. This weakness is confirmed by the candlestick that follows the star. This candlestick must be a red candlestick and must close 50% above the body of the first candlestick. BULLISH/BEARISH ENGULFING The Engulfing candlestick pattern is a two-candle reversal pattern. A reversal pattern can be bearish or bullish, depending on whether it appears at the end of an uptrend (bearish engulfing) or a downtrend (bullish engulfing pattern). The first candle is a small body, followed by the second candle whose body completely engulfs the previous candle body and closes in the opposite direction of the trend. BULLISH/BEARISH RAILWAY TRACKS A bearish railway track pattern has the first candlestick bullish and the second candlestick bearish. That fact that there is a sudden change from bullish to bearish candlestick should be a good indication that there might be a bearish trend forming. If you see it inside of the determined strong area the more powerful it is! Regards, Vaido
COINBASE:BTCUSDEducation
by VaidoVeek
13