What does a long wick mean on a candlestick?
The bullish candles decrease in size before the price printed a pinbar with a long wick. The long wick is a strong reversal signal. Following the pinbar, a large bearish candle occurred. This pattern indicates the deceleration of the uptrend and then the acceleration of the new downtrend.
Which is the best way to trade candlesticks?
Pin bars are the most effective ways to trade candlesticks as these formations tend to create high probability price action trading setups. A pin bar forms when the price goes up or down during a single time period, but the closing price remains within the previous bar. In Figure 1, we have identified two pin bars, a bullish one and a bearish one.
What does it mean when candlesticks are engulfing?
Just like pin bars, bullish and bearish engulfing candlestick patterns also signal a reversal of the prevailing trend. In the western trading industry, these patterns are better known as Bullish Outside Bars (BUOB) and Bearish Outside Bars (BEOB).
What does a tweezer candlestick pattern mean?
A tweezer candlestick pattern is made up of two candlesticks with equally long wicks. The tweezer indicates a move in the opposite direction of the candlestick wicks. In the example below, the tweezer occurred at a key price level too.
Which is the kicker candle in a candlestick pattern?
In this example, the price is moving lower, and then the trend is reversed by a gap and large candle in the opposite direction. The first large green candle is the kicker candle. The second strong green candle shows the follow through of the powerful pattern and helps confirm that a reversal is in place.
What are some of the advanced candlestick patterns?
Below, we will look at more advanced candlestick patterns that offer a higher degree of reliability. These include the island reversal, hook reversal, three gaps and kicker patterns. Island reversals are strong short-term trend reversal signals. They are identified by a gap between a reversal candlestick and two candles on either side of it.
What does a strong green candle mean on a candlestick?
The second strong green candle shows the follow through of the powerful pattern and helps confirm that a reversal is in place. Entry: This kind of price action tells you that one group of traders has overpowered the other and that a new trend is being established.
What kind of candlesticks are best for children?
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