CANDLE STICKS

Candlestick charts can display various types of patterns, each with its own significance for traders. Here are some common types:

1. **Doji**: When the opening and closing prices are nearly equal, forming a small body with long upper and lower wicks. It indicates indecision in the market.

2. **Marubozu**: A candlestick with a long body and little to no wicks. A white (or green) marubozu indicates strong buying pressure, while a black (or red) marubozu suggests strong selling pressure.

3. **Hammer**: A candlestick with a small body and a long lower wick, resembling a hammer. It indicates a potential reversal from a downtrend to an uptrend.

4. **Shooting Star**: The opposite of a hammer, with a small body and a long upper wick. It suggests a potential reversal from an uptrend to a downtrend.

5. **Engulfing Pattern**: When a candlestick's body completely engulfs the body of the previous candlestick. A bullish engulfing pattern occurs at the end of a downtrend and signals a potential reversal to an uptrend, while a bearish engulfing pattern suggests the opposite.

6. **Harami**: A two-candlestick pattern where the body of the second candlestick is within the range of the first candlestick's body. It indicates a potential reversal.

7. **Morning Star / Evening Star**: A three-candlestick pattern signaling potential reversals. The morning star appears during a downtrend and consists of a long black candle, followed by a small candle (doji or spinning top), and then a long white candle. The evening star appears during an uptrend and has the opposite formation.

These are just a few examples, and there are many more candlestick patterns that traders use to analyze price movements and make trading decisions.

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