Five Basic Candlestick Patterns To Learn & Advance Your Day Trading Career Right Now
Portfolio Pulse from John Chang
This article discusses five basic candlestick patterns used in technical analysis to predict future price movements in financial markets. The patterns include Doji, Hammer and Hanging Man, Bullish Engulfing and Bearish Engulfing, Morning Star and Evening Star, and Shooting Star and Inverted Hammer. Examples are provided using Advanced Micro Devices (AMD), Invesco QQQ Trust (QQQ), Amazon (AMZN), and Apple (AAPL).
May 30, 2023 | 4:09 pm
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NEUTRAL IMPACT
Apple (AAPL) exhibited Morning Star, Evening Star, Shooting Star, and Inverted Hammer patterns.
These patterns signify potential trend reversals, but traders should use them in conjunction with other technical analysis tools and indicators to make well-informed trading decisions.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 50
NEUTRAL IMPACT
An example of a Doji reversal pattern was observed in Advanced Micro Devices (AMD) on March 23, 2023.
The Doji pattern signifies indecision in the market and suggests a potential trend reversal or significant price movement. However, traders often look for confirmation from subsequent candlesticks before making any trading decisions based on a Doji pattern.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 50
NEUTRAL IMPACT
Amazon (AMZN) displayed Bullish Engulfing and Bearish Engulfing patterns on the daily timeframe.
The Engulfing patterns indicate potential trend reversals, but traders often wait for confirmation before acting on these patterns.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 50
NEUTRAL IMPACT
Invesco QQQ Trust (QQQ) showed Hammer and Hanging Man patterns on the daily time frame, signaling short-term reversals.
The Hammer and Hanging Man patterns suggest potential trend reversals, but traders often wait for confirmation in the form of a subsequent bullish candlestick before considering a long position or trend reversal.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 50