Complete reference
Candlestick Patterns
Every pattern below is explained the same way: what it looks like, what the market had to do to print it, when it means something, and exactly where the stop goes. No signals and no win-rate claims, just the mechanics.
A candlestick compresses four numbers (the open, high, low and close of a period) into one shape. The body spans the open and close; the shadows reach out to the extremes. A pattern is simply one or more of those shapes in an arrangement that has historically described a recognisable shift in supply and demand.
That is the whole idea, and it is worth being precise about what it does and does not give you. A candlestick pattern tells you what just happened in a compact, readable form. It does not tell you what happens next. The traders who lose money with candlesticks are almost always the ones who treated the second thing as though it followed from the first.
Used properly, a pattern does three useful jobs: it flags that the balance of pressure may be shifting, it gives you a precise trigger level, and, most valuably, it hands you a logical place to put your stop loss. That last one is why the patterns are worth learning even if you never treat them as entry signals.
Bullish Reversal Candlestick Patterns
Bullish reversal patterns form at the end of a decline. Each one describes the same underlying event in a different way: sellers pushed price down and buyers absorbed it. What separates them is how much evidence they give you, and how wide a stop that evidence costs.
- bullish 1 candle
Hammer Candlestick Pattern
One of the most reliable single-candle reversal signals when it appears in the right place. Here is how to tell a real hammer from the dozens of look-alikes that trap beginners.
- bullish 2 candles
Bullish Engulfing Pattern
A two-candle reversal that carries its own confirmation. When a green candle completely engulfs the prior red one, control of the market changed hands in a single session.
Bearish Reversal Candlestick Patterns
Bearish reversal patterns form at the end of an advance. They mark the sessions where buyers ran out of willing counterparties and supply took control. Most traders should use them to exit longs and tighten stops rather than to open shorts.
- bearish 1 candle
Shooting Star Candlestick
The mirror image of the hammer, appearing at tops. A long upper shadow means the rally was sold into, and everyone who bought the high is now trapped.
- bearish 2 candles
Bearish Engulfing Pattern
A two-candle topping signal with confirmation built in. When a red candle swallows the prior green one whole, sellers took back a full session in a single day.
- bearish 1 candle
Hanging Man Candlestick
The same shape as a hammer, in the opposite place. After an uptrend, that long lower shadow stops being reassuring and starts being a warning.
Indecision Candlestick Patterns
Indecision candles have almost no body: the session opened and closed at nearly the same price. On their own they signal nothing directional. Their value is as a change in character, evidence that one-sided pressure has paused, and they must be traded through the candle that follows.
- neutral 1 candle
Doji Candlestick
The most misunderstood candle on the chart. A doji is a pause, not a reversal signal, and knowing the difference is what separates traders who use it well from those who lose money on it.
- neutral 1 candle
Spinning Top Candlestick
A small body with shadows either side. Price travelled in both directions and finished near where it began: a stalemate, and a change in character worth noticing.
Candlestick pattern FAQs
What are candlestick patterns?
Candlestick patterns are recognisable shapes formed by one or more price candles, each of which shows the open, high, low and close for a period. The shapes summarise how the fight between buyers and sellers resolved during that period, which is why traders use them to judge whether pressure is building, easing, or changing direction.
Which candlestick pattern is the most reliable?
No single pattern is reliable in isolation. The ones that perform best in practice are multi-candle patterns with built-in confirmation (engulfing patterns, morning and evening stars, and three-candle patterns), and only when they form at a level that already mattered, on above-average volume, against a clear prior trend.
Do candlestick patterns still work?
The shapes still form and still describe real supply and demand, because they are simply a way of drawing price data. What has changed is that they are widely known, so trading them mechanically without context has little edge. They work best as a timing tool inside a plan that already has a reason to be interested in the level.
What timeframe works best for candlestick patterns?
Daily and weekly charts produce the most dependable signals, because each candle represents a full session of genuine participation. Patterns on 1-minute and 5-minute charts form constantly and are far more often noise. As a rule, the higher the timeframe, the more meaningful the pattern.
How many candlestick patterns do I need to know?
Far fewer than most beginners think. Six or seven (hammer, shooting star, bullish and bearish engulfing, doji, morning star and evening star) cover the large majority of situations worth acting on. Knowing forty patterns shallowly is less useful than knowing six deeply enough to judge context.