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How to Read Candlesticks: Part 2

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How to Read Candlesticks: Part 2

In continuation to my previous blog “How to read candlesticks”, we have seen how to read candlesticks, understanding candlesticks, the shadows of candlesticks and a few patterns. In this blog we will see more patterns of candlesticks.

First, let's cover a few basics from the previous blog.

How to Read Candlesticks

  1. There are different types of candlestick formations
  2. It is important to understand candlesticks and to see how fear and greed are the two main drivers which drive markets
  3. It is important to understand the meaning behind the size, shadows and tails of candlesticks.

All of this was covered in my previous blog. Now, let us continue with learning more candlestick patterns.

Bearish Candlestick Reversal Patterns

 

Bullish Candlestick Reversal Patterns

 

Few tips for trading:

  • Before you enter any trade reading the charts, make sure of the trend of the stock you are going to enter.
  • Identify your exit point. Keep a strict stop loss if you are trading against the trend
  • Do not predict the pattern as per your trade.
  • If you are aware of technical indicators get help from these indicators to confirm your study. Few good technical indicators are: Moving Averages, MACD, RSI and Stochastic.

See how you can can incorporate candlestick formations into your trading strategies this week.

Happy Trading!

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