Some Common Candlestick Patterns (Part 2.1)

In the previous post I shared with you 4 Candlestick Patterns and today I will share with you 4 more patterns in a series of discussions (2.1 and 2.2). You know I try to give some examples in this discussion so that you can get a fair idea of the pattern through the examples without any pictures. In fact, if you work for a long time in the trading world, it is possible for you to get an idea about these things. So I am trying to share the basic discussion for those who are new. Hope you can get a basic idea about these Candlestick Patterns and by doing this you can study them more deeply later. Let's take a look at 4 more Candlestick Patterns in today's post.

Bearish Engulfing

The Bearish Engulfing candlestick pattern consists of two candlesticks. In this case, the first candlestick is bullish, followed by a larger bearish candlestick that engulfs the body of the previous candlestick. It indicates a potential reversal from an uptrend to a downtrend.

Example:

Suppose Bitcoin Cash (BCH) experiences a bullish day, with the price rising from $600 to $700. However, on the following day, the price opens at $690 and drops to close at $620, completely engulfing the body of the previous day's candlestick. This Bearish Engulfing pattern suggests a potential reversal in the uptrend.

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Morning Star

The Morning Star candlestick pattern is a bullish reversal pattern that consists of three candlesticks. The first candlestick is bearish, followed by a small-bodied candlestick that opens lower but closes higher (forming a gap), and finally, a bullish candlestick that closes near the high of the first candlestick.

Example:

Suppose Cardano (ADA) experiences a downtrend, with the price dropping from $1.50 to $1.20. However, on the third day, a small-bodied candlestick forms with a gap down, followed by a bullish candlestick that closes near the high of the first candlestick. This Morning Star pattern suggests a potential reversal in the downtrend.

To be continued

~ Regards,
VEIGO (Community Mod)

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