Here are ten bearish candlestick patterns that can help you spot potential market reversals and prevent losses:
1. Bearish Engulfing
Overview: A larger bearish candle completely engulfs the previous smaller bullish one, signaling a strong shift towards the downside.
Meaning: Suggests sellers have taken control, indicating a possible bearish reversal.
2. Evening Star
Overview: A three-candle pattern starting with a large bullish candle, followed by a small indecisive candle (star), and ending with a bearish candle that closes deep into the first candle’s body.
Meaning: Indicates a reversal at the top, with momentum shifting from buyers to sellers.
3. Three Black Crows
Overview: Three consecutive long bearish candles, each closing lower than the last, typically with small or no wicks.
Meaning: A strong signal of continued downward momentum, hinting at a possible downtrend.
4. Dark Cloud Cover
Overview: A bearish candle opens above the previous bullish candle’s close but closes below the midpoint of the previous candle.
Meaning: Shows strong selling pressure, indicating a bearish reversal.
5. Shooting Star
Overview: A single candle with a small body near the day’s low and a long upper wick, indicating that prices were pushed higher but couldn't be sustained.
Meaning: Signals a potential reversal after an uptrend, suggesting buyers are losing control.
6. Bearish Harami
Overview: A small bearish candle is entirely contained within the prior larger bullish candle.
Meaning: Shows indecision, signaling a potential bearish reversal.
7. Hanging Man
Overview: A bearish reversal pattern with a small body at the top of the range and a long lower wick, indicating strong selling pressure.
Meaning: Appears at the top of an uptrend, signaling a possible reversal.
8. Gravestone Doji
Overview: A candle with no body and a long upper wick, closing at the session low, indicating a rejection of higher prices.
Meaning: A strong bearish reversal signal, especially after an uptrend.
9. Falling Three Methods
Overview: A bearish candle is followed by three smaller bullish candles within the first candle’s range, ending with another strong bearish candle.
Meaning: A continuation pattern confirming the existing downtrend.
10. Bearish Abandoned Baby
Overview: A rare three-candle pattern where a doji appears after a gap up, followed by a bearish gap down.
Meaning: A strong bearish reversal signal, showing buyers lost momentum.
Understanding these patterns can help you make better trading decisions, spot bearish reversals, and protect your investments.#USDataImpact
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