Candlestick Chart Patterns

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Candlestick chart patterns visualize accelerations and slowdown in trends—or indicate trend reversals.

Candlestick charts work with the same OHLC (opening, high, low, close) data as regular bar charts. The only difference is that a key-reversal-day on a bar chart, for example, can be easier to identify by looking for a hammer or a doji candlestick formation.

Candlestick charts are popular because they identify the momentum in a price move on every price bar by comparing the opening price with the closing price and showing black and white candlesticks, depending on whether the opening is higher or lower than the closing price.

Candlestick charts are very good trading tools by themselves, but they also combine well with other trading tools.

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