Candlestick Patterns-Hammer-Shooting Star-Evening-Morning Star

Candlestick patterns are useful for Price Action Trading , they provide useful information about the market. They are quite effective when used in conjunction with other technical indicators and tools. I find the hammer and evening star especially useful because they can serve as warning signs of price reversal.

A candlestick is a visual representation of data concerning price movement for a specified period of time. This data includes the open, high, low and close prices of the specific time period. The time period depends on the timeframe selected: 1 minute, 15 minutes, 30 minutes, 1 hour and so on and so forth.

1. Hammer & Shooting Star

A Hammer is a candlestick with a long lower shadow 2-3 times the length of its body and has no or little upper shadow. It usually appears in a downtrend indicating a possible bullish reversal, but a bullish confirmation is needed before entering a buy trade.

A shooting star is a bearish reversal candle. It has a small body, a very long upper shadow, an absent or short lower shadow. It appears when price has been increasing and is considered.
Candlesticks-Hammer-shooting-star

2. Evening & Morning Star

These star patterns are composed of 3 candles, with long first and third candles, and a doji or short middle candle.

There’s normally no gap before and after the middle candle, but if there is, the gap would be very small.

An Evening Star is a bearish reversal pattern, while the Morning Star is a bullish reversal.Candlesticks-morning-star-evening-star-chart

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