Candlestick charts are basically the technical tool that is used on online trading and it packs data for multiple time frames into one single price bar. The Candlestick Patterns are very useful compared to the low-close bars and traditional open high bars or simple lines that actually link the dots of closing prices. It is used by the traders to predict the price direction once they are completed. With the proper colouring codes, one can add depth to the colourful technical tools and this dates back to the 18th century Japanese Rice Traders. Below are the top five Candlestick patterns.
Three Line Strike
This is the bullish three line strike which is in the reversal pattern covers that three black candles within the downtrend. Each of the bars is in lower low and closes near the intrabar low and the 4th bar open even lower but reverses the wide range of outside bar that closes above the high of first candle in series.
Two Black Gapping
The two black gapping continuation pattern actually appears after the notable top in the uptrend with a gap down that basically yields the two black bars posting lower lows.
Three Black Crows
Bearish Three Black Brows is the reversal pattern that actually starts at or close to the high of the uptrend with the three black bars posting the lower lows that close near to the intrabar lows and it predicts the decline will continue to even lower lows.
Evening Star is the reversal pattern that starts with the tall white bar and it carries the uptrend to the new height. The gap in the market in on next bar but the fresh buyer fails to appear yielding the narrow range Candlestick.
It is the reversal pattern that appears at the low of downtrend after the series of black candles print lower lows.