Are you finding the best 5 candlestick patterns to boost your trading?

You came to the right place. Read the whole article to learn about it.

Candlestick patterns are the best way to read the candlestick chart.

As we can easily understand by seeing the candlestick pattern, when to buy and
sell depends on the trade and the candlestick formation.

The best 5 candlestick patterns are:

5. spinning top

The spinning top is the candlestick pattern, which looks like a spinner.

As we already know about the low, high, open, and close of a candlestick,.

A candlestick has a wick. A wick is nothing but the thin line that points out
below and above the body of the candlestick.

Spinning top candlestick

In a spinning top, a candle has an equal length of wick below and above the body of the
candlestick, with the small body in the middle. It can be green or red in
color, depending on the sentiment of the stock.

There are two types of spinning tops that are normally seen, and they
are:

• single candle spinning top and
• double candle spinning top

What does the spinning top candlestick pattern tell us?

A spinning-top candlestick pattern is made when there is great confusion
between buyers and sellers.

As buyers pull the stock price high, forming a wick upside, and consequently,
sellers pull it low, forming a wick downside, both wicks are of equal length.

Possible Directions:

• sideways are possibly seen.
• If it happens in a downtrend or an uptrend, a reversal is seen.

4. Doji

One of the most used candlestick patterns of all time.

 

The Doji candlestick pattern doesn’t have any body; if it does, then it
could be related to a spinning top candlestick or something else of a
similar kind.

 

Doji or long-legged doji

There is a low, a high, and a dash of horizontal shape, which represents
a doji.

 

A doji’s open and close are equal.

 

There is a possibility of having a single doji and a double doji together
in a candlestick chart.

 

There are basically four kinds of Doji.

• Lond-legged doji: represents a long head and long tail wick with no body in the
  middle, just a dash.
• Gravestone doji: It has no legs but a long head. It usually occurs in a bearish
  trend with a bull in the market; just try to take the price above,
  creating a long head, but fail to take and come to position where it
  opens.
• Dragonfly doji: It has no head but a long tail. It usually happens in an uptrend
  where the price opens high and the bear of the market takes it down
  but fails to sustain it, creating a long tail and going back to its
  position from where it started.
  

Gravestone doji, dragonfly doji, price doji

• Price-doji, single-line doji, or horizontal doji: it is basically a dash (horizontal line dash) that may happen in
  the downtrend or in the uptrend. It forms due to an upper or lower
  circuit.

What does the Doji candlestick pattern tell us?

Doji is created when there is an undecision or stalemate in the stock, as
the bulls and bears are not able to take the stock up or down and the
price remains constant, making the opening and closing prices the
same.

 

possible directions:

• sideways or working in a range
• trend reversal, as doji is seen as probably changing the direction of
  the stock price.

3. Tweezer candlestick pattern

A tweezer candlestick pattern is a two-candlestick pattern that has
the same bottom or top candles.

Tweezer candles are formed consecutively. It may vary in
shape, length, and colour, but the tops and bottoms are the
same.

 

There are two types of tweezer candlestick patterns, and they
are:

• Tweezer Tops and
  
• Tweezer bottoms

Tweezer tops: they are made in the top when there is a bullish
trend in the stock or in the market, and the two candles are formed
with the same tops.

 

Tweezer Top

 

Tweezer bottoms: they are made at the bottom when there is a
bearish trend in the stock or market and the candles are formed,
displaying the same bottoms.

 

Tweezer Bottom

What does the Tweezer candlestick pattern tell us?

Tweezer candlesticks are made when the traders are able to see the
tops and bottoms of the stocks, not allowing the stock to go above the
top or below the bottom.

 

Possible directions:

• Reversal (changing from the present direction to the opposite
  direction).

As we know from the above description, when it is made.

• If it appears at the top, then the stock is likely going to go
  down. and
• If it appears at the bottom, then it is preparing the stock to go
  above.

2. Marubozu

This is one of the easiest-to-understand candlestick patterns,
which is mostly used by newbies because it is easier to find than
any other candlestick pattern in the chart.

 

Marubozu is a full-body candlestick with no wick on the up and
down sides.

 

We find the Marubozu candlestick pattern when there is strong
sentiment in the stock or in the market, as it fills the whole
body with low, high, close, and open.

 

Basically, there are two types of
Marubozu candlestick patterns, and they are:

• • Bearish Marubozu: this is a candlestick body
    that has no wick but only a body with a red color, denoting
    the strong bearishness of the price or the stock.

    Bearish Marubozu
  • Bullish Marubozu: in this candlestick, the
    candle has only a body with no wick on the downside or upside.
    It is green in color, denoting the strong bullishness of the
    price or the stock.

Bullish Marubozu

What does the Marubozu candlestick pattern tell us?

As we know now, it happened because of the ruling of one group of
people, whether bears or bulls.

 

If bears rule, then bearish or red candles happen, and if bulls
rule, then bullish or green candles happen.

 

Strong body with strong sentiment, which has low as open and high
as close in a bullish Marubozu candle and high as open and close
as low in a bearish Marubozu candle.

 

Possible directions:

• Continuation of trend: If the bearish or bullish Marubozu candles happen in the
  middle of the bearish or bullish trend, then it is taken as a
  continuation of the present trend.
• Reversal of the trend: it means changing the present trend to an opposing trend,
  and in Marubozu, there are two cases where the reversal is
  meant to happen, and they are:1.
  Reversal to the bearish trend
  when the bearish candle happens in the bullish trend, usually
  at the top.2.
  Reversal to the bullish trend when the bullish candle
  happens in the bearish trend, usually at the bottom.

1. Hammer

This is one of the most popular and best trading candlestick
patterns, which is not only used by newbies but also by
experts.

 

One of the best parts of using it is that its failure chance
is very low compared to any other candlestick pattern.

What is a hammer candlestick pattern? What does it look
like?

A hammer candlestick pattern is a candle in a candlestick
chart that looks like a hammer.

 

A hammer candle looks like a candle that has a small body and
a wick, whereas the body closes below or above the opening of
the candle with a long wick either on the upside or downside,
with the small wick on the other side.

 

Normally, there are two types of hammer candles, and
they are:

1. Hammer candle: it has a small body with a long wick on the downside,
   almost 2/3rd of the upside wick of the candle.

   Hammer candlestick
2. Inverted hammer candle: it is just the opposite of the hammer candle; the only
   difference is that it has a long wick on the upside.

   Inverted hammer

Remember that a hammer candlestick pattern occurs in
the downtrend of the market or in a bearish market. Most
people mistake the shooting star candlestick pattern for an
inverted hammer candlestick pattern.

What does the Hammer candlestick pattern tell us?

The Hammer candlestick pattern happens in a downtrend when
there is a bearish sentiment going on in the stock or in the
market.

 

Suddenly, there is a pull from the bottom by the buyers to
close it near the opening of the candle, reflecting a good
accumulation by the buyers over the sellers. It gives a
positive sign for buying the stock, and the confirmation is
gotten when the next candle after the hammer closes above
it.

 

Possible dierctions:

• Strong Reversal

The hammer candlestick is a strong reversal candlestick
pattern that strongly reverses the bearish trend to a
bullish trend.

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Final thoughts

All of these candlesticks are used by me, and I find them very
easy to understand, which provides me with the best opportunity to
take a trade in any segment or stock.

Be careful when you take a trade on any of these candlesticks. The
only thing you need to do is use a stoploss and accept if the
candlestick does not provide you with the result that you thought
it would.

So use the best trading platform where you find it easy to open candlestick charts and work on them without any technical glitches.

At last, these are widely used because of the results they
provide. So why wait? Go learn it and use it.

FAQs on the 5 best candlestick patterns