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Candlestick Pattern Encyclopedia

The most important candlestick formations explained clearly – how to spot them, what they reveal about the market, and how to trade them.

Single candle

Neutral

Doji

A candle that closes with almost no body (open ≈ close). It signals indecision – buyers and sellers are balanced.

Bullish

Hammer

A small body on top with a long lower wick, after a downtrend. Buyers bought back a sell-off – a bullish reversal signal.

Bullish

Inverted Hammer

Small body at the bottom with a long upper wick, after a downtrend. A first buyer attempt upward – a potentially bullish turn.

Bearish

Shooting Star

Small body at the bottom with a long upper wick, after an uptrend. A rejected buyer attempt – a bearish reversal signal.

Bearish

Hanging Man

Small body on top with a long lower wick, after an uptrend. A first sign that sellers are stepping in – a bearish warning.

Two candles

Bullish

Bullish Engulfing

A large green candle completely engulfs the body of the previous red one – after a downtrend, a strong bullish reversal signal.

Bearish

Bearish Engulfing

A large red candle completely engulfs the body of the previous green one – after an uptrend, a strong bearish reversal signal.

Bullish

Bullish Harami

A small green candle sits entirely within the body of the previous large red one. After a downtrend, a sign of fading selling pressure.

Bearish

Bearish Harami

A small red candle sits entirely within the body of the previous large green one. After an uptrend, a sign of fading buying momentum.

Bullish

Piercing Line

After a red candle the green one opens lower but closes above the midpoint of the red. A bullish reversal signal after a downtrend.

Bearish

Dark Cloud Cover

After a green candle the red one opens higher but closes below the midpoint of the green. A bearish reversal signal after an uptrend.

Three candles

Bullish

Morning Star

Three candles: large red, a small candle (the star) gapping down, a large green. A strong bullish reversal pattern at the end of a downtrend.

Bearish

Evening Star

Three candles: large green, a small candle (the star) gapping up, a large red. A strong bearish reversal pattern at the end of an uptrend.

Bullish

Three White Soldiers

Three consecutive large green candles with higher closes. A clear sign of a buyer takeover.

Bearish

Three Black Crows

Three consecutive large red candles with lower closes. A clear sign of a seller takeover.

Education, not investment advice. Candlestick patterns are hints, not guarantees – they need confirmation and context (trend, levels, volume). Always manage risk with stop-loss and position size.