Posts

Showing posts from May, 2020

Best Candlestick Patterns for Price Action Analysis

Image
As mentioned in a recent post, the key for a better Price Action Analysis with candlesticks is "read" them at a glance and the patterns it forms, mainly when price approaches an S-R level, doing always in conjunction with volume.

Candlesticks are a reflection of what buyers and sellers are doing. You need to know its meaning: indecision, rejection, reversal, or momentum.  In Price Action Analysis, less is more with technical indicators: a few of them are enough. The same idea for candlestick patterns. You can find dozens of candlestick chart patterns, but I feel comfortable with a few of them, the most accurate in my point of view.  No need to memorize them all, just understand the mechanics behind this tool. Consider the following:

Single candlesticks
1- Pin Bar (or long-wick candle): the longer the wick, the better the candle. This candle means that indecision began, as buyers tried to push price higher but failed, causing the wick to show, meaning a rejection. There are b…