Section 4 - Chapter 3 - Introduction to Candlestick Patterns

Agenda Identify various candlestick patterns Examine the psychological insights revealed in various candlestick patterns Relate the meaning of candlesticks patterns with their volume characteristics Distinguish between various types of doji candlesticks This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📌 Key Takeaways 1. Both are reversal patterns but in different trends: Hammer occurs in a downtrend and signals a bullish reversal. Hanging Man appears in an uptrend and suggests a bearish reversal. 2. Appearance is the same, meaning is different: Small real body at the top, long lower shadow, and little/no upper shadow. The trend context defines whether it’s a Hammer (bullish) or Hanging Man (bearish ).

Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📌 Key Takeaways 3.Confirmation is necessary: Hammer : Needs a bullish close in the next session. Hanging Man: Requires a bearish close in the next session. 4. Volume enhances reliability: Higher volume during the confirmation candle increases the pattern's strength. 5. Proper location matters: If a Hammer appears in an uptrend, or a Hanging Man in a downtrend, they lose significance.

Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🎯 Significance • Trend Reversal Indicator: Signals the end of an existing trend. • Trader Decision-Making: Helps traders identify potential entry or exit points . • Psychological Shift: Represents a battle between bulls and bears . • Best Used with Other Indicators: Should be confirmed with volume , RSI, MACD , or trendlines.

Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🎯 Location & Importance Pattern Where It Should Appear Where It Is Meaningless Hammer At the bottom of a downtrend Inside an uptrend Hanging Man At the top of an uptrend Inside a downtrend

Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🔍 Characteristics Hammer ✅ Forms in a downtrend ✅ Small real body at the top ✅ Long lower shadow (at least twice the body’s length) ✅ Little or no upper shadow ✅ Suggests a bullish reversal 🔍 Characteristics Hanging Man ✅ Forms in an uptrend ✅ Small real body at the top ✅ Long lower shadow (at least twice the body’s length) ✅ Little or no upper shadow ✅ Indicates a bearish reversal

Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📌 Psychology Behind the Patterns Hammer (Bullish Reversal) Bears initially push the price down (long lower shadow). Buyers step in aggressively, pushing the price back up. Closing near the open indicates bulls regaining control. Next candle’s bullish confirmation reinforces the uptrend . 📌 Psychology Behind the Patterns Hanging Man (Bearish Reversal) Bulls push the price up initially. Bears gain strength, driving the price down before the close. Closing near the open shows buyers are losing control. A bearish follow-up candle confirms the shift in momentum.

Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📌 Volume Behavior • Hammer: o High volume on the Hammer candle suggests strong buyer interest. o Even higher volume on the confirmation candle strengthens the signal. • Hanging Man: o High volume on the Hanging Man shows selling pressure emerging. o A spike in volume on the next bearish candle confirms the reversal.

Cheat Sheet: Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Hammer Downtrend Small body, long lower shadow, little/no upper shadow Bullish Reversal Yes, next candle should close higher Hanging Man Uptrend Small body, long lower shadow, little/no upper shadow Bearish Reversal Yes, next candle should close lower

Differentiate: Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Aspect Hammer Hanging Man ‍ Trend Context Downtrend Uptrend Indicates Bullish Reversal Bearish Reversal Market Psychology Buyers regain control Sellers overpower buyers Confirmation Bullish close needed Bearish close needed Volume Significance High volume on confirmation strengthens bullish case High volume on confirmation strengthens bearish case

Conclusion: Hammer & Hanging Man Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia ✅ Conclusion The Hammer and Hanging Man patterns are powerful reversal signals but should never be used in isolation. Confirmation through price action, volume, and additional indicators is crucial for reliability. Hammer = Potential Bullish Reversal (Downtrend to Uptrend) Hanging Man = Potential Bearish Reversal (Uptrend to Downtrend ) When combined with support/resistance levels, trend analysis, and indicators like RSI or MACD, these patterns can greatly enhance trading accuracy. 🚀

Shooting Star Candlestick Pattern This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📌 Key Takeaways 1. Bearish Reversal Signal: The Shooting Star appears at the top of an uptrend, signaling a potential trend reversal. 2. Distinct Shape: Small real body at the bottom with a long upper shadow and little/no lower shadow. 3. Indicates Rejection of Higher Prices: The long upper shadow shows that buyers tried to push prices higher, but sellers took control and pushed prices back down. 4. Confirmation is Necessary: The next candle should close lower to confirm the bearish reversal. 5. Higher Volume Strengthens the Pattern: A Shooting Star with high volume suggests strong selling pressure.

Cheat Sheet: Shooting Star Candlestick Pattern This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Shooting Star Uptrend Small body at bottom, long upper shadow, little/no lower shadow Bearish Reversal Yes, next candle should close lower

Shooting Star Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🎯 Significance • Signals Weakness in an Uptrend: A Shooting Star suggests that buyers are losing strength, and a reversal may follow. • Early Warning System: Helps traders anticipate a potential shift from bullish to bearish sentiment. • Widely Used in Technical Analysis: Works best when combined with resistance levels, RSI, MACD, or trendlines. • Confirmation is Key: The bearish confirmation candle (closing below the Shooting Star) strengthens the signal.

Shooting Star Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🎯 Location & Importance Pattern Where It Should Appear Where It Is Meaningless Shooting Star At the top of an uptrend Inside a downtrend or sideways market

Shooting Star Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🔍 Characteristics Shooting Star Candlestick Patterns ✅ Appears at the top of an uptrend ✅ Small real body near the bottom ✅ Long upper shadow (at least twice the body’s size) ✅ Little or no lower shadow ✅ Suggests bearish reversal

Shooting Star Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📊 Volume Behavior • High volume on the Shooting Star candle suggests strong seller participation and increases the pattern’s reliability . • Even higher volume on the confirmation candle strengthens the bearish signal and suggests continued selling pressure.

Shooting Star Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Aspect Shooting Star 🌠 Inverted Hammer 🔨 Trend Context Uptrend Downtrend Indicates Bearish Reversal Bullish Reversal Market Psychology Sellers overpower buyers after a failed rally Buyers regain control after a price dip Confirmation Needed? Yes, bearish close needed Yes, bullish close needed Volume Significance High volume strengthens bearish case High volume strengthens bullish case

Shooting Star Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📌 Psychology Behind the Shooting Star • At first, buyers push the price up, creating a long upper shadow. • Sellers then take control, driving the price back down before the close . • Closing near the open (or lower) signals buyer exhaustion and a potential shift in momentum. • If the next candle closes lower, it confirms a bearish trend reversal.

Conclusion : Shooting Star Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia ✅ Conclusion The Shooting Star is a bearish reversal candlestick pattern that appears after an uptrend. It signals buyer exhaustion and the potential start of a downtrend. Key Points to Remember: It must form at the top of an uptrend to be valid. A long upper shadow shows rejection of higher prices. Confirmation (a bearish candle closing lower) is crucial before making a trade. Higher volume strengthens the pattern’s reliability .

Doji Candlestick Pattern 📌 Key Takeaways 1. Indecision Pattern: A Doji indicates market indecision, where buyers and sellers are evenly matched. 2. Neutral Signal: By itself, it doesn't confirm a direction but signals a potential reversal or continuation, depending on confirmation. Distinct Shape: The open and close prices are nearly the same, forming a very small or non-existent real body . Types of Doji: Variations include Standard Doji, Long-Legged Doji, Gravestone Doji, Dragonfly Doji, and Four-Price Doji, each with different implications . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Doji Candlestick Pattern 📌 Key Takeaways 5 . Confirmation is Crucial: o In an uptrend, a Doji followed by a bearish candle may signal a reversal downward. o In a downtrend, a Doji followed by a bullish candle may indicate a reversal upward. o In a sideways market, it suggests continued consolidation. 6. Volume Adds Strength: High volume with a Doji increases the likelihood of a trend reversal. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Cheat Sheet: Doji Candlestick Pattern This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Doji Type Shape & Features Market Signal Confirmation Required? Standard Doji Small/no real body, equal upper & lower shadows Indecision, possible reversal Yes, next candle confirms direction Long-Legged Doji Long upper & lower shadows Strong indecision Yes, next candle confirms direction Gravestone Doji Open & close at the bottom, long upper shadow Bearish reversal at top of uptrend Yes, next candle should close lower Dragonfly Doji Open & close at the top, long lower shadow Bullish reversal at bottom of downtrend Yes, next candle should close higher Four-Price Doji Open, close, high, and low are the same Extreme indecision, rare Yes, but unreliable alone

Doji Candlestick Pattern 🎯 Significance • Indicates Market Indecision: Neither bulls nor bears have clear control. • Key Reversal or Continuation Clue: o In an uptrend, a Doji could signal buyer exhaustion and a potential bearish reversal. o In a downtrend, a Doji may suggest seller exhaustion and a potential bullish reversal. o In a sideways trend, it signals ongoing consolidation. • Works Best with Other Indicators: Should be confirmed with support/resistance levels, RSI, MACD, or trendlines. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Doji Candlestick Pattern 🔍 Characteristics ✅ Small or non-existent real body (open and close nearly the same) ✅ Can appear in any trend ✅ Signifies indecision between buyers and sellers ✅ Requires confirmation for a reliable trading signal This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Doji Candlestick Pattern 📌 Position & Importance This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Where It Appears Meaning Uptrend Possible reversal if followed by a bearish candle Downtrend Possible reversal if followed by a bullish candle Sideways Market Suggests continued consolidation

Doji Candlestick Pattern Psychology Behind the Doji • Buyers and sellers battle but end up at a stalemate—open and close prices are nearly identical. • Indicates uncertainty about the trend’s continuation. • Next candle determines if the market reverses or continues in the same direction. • If confirmed by a strong candle in either direction, the Doji can mark a significant trend shift. 📊 Volume Behavior • High volume with a Doji suggests a potential trend reversal, as it indicates a strong battle between buyers and sellers. • Low volume suggests that the market is consolidating, and the trend may continue. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Dragonfly Doji & Gravestone Doji Candlestick Patterns 📌 Key Takeaways 1. Both are Doji patterns, signaling potential reversals depending on trend context. 2. Dragonfly Doji appears at the bottom of a downtrend and signals a bullish reversal. 3. Gravestone Doji appears at the top of an uptrend and signals a bearish reversal. 4. Distinct Shape: o Dragonfly Doji: Long lower shadow, little/no upper shadow, open = close at the top. o Gravestone Doji: Long upper shadow, little/no lower shadow, open = close at the bottom . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Dragonfly Doji & Gravestone Doji Candlestick Patterns 📌 Key Takeaways 5 . Confirmation is Crucial: o Bullish confirmation (next candle closing higher) strengthens a Dragonfly Doji. o Bearish confirmation (next candle closing lower) confirms a Gravestone Doji . 6. Volume Adds Reliability: o High volume on a Dragonfly Doji means strong buyer interest. o High volume on a Gravestone Doji indicates strong selling pressure. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Cheat Sheet : Dragonfly Doji & Gravestone Doji This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Dragonfly Doji Downtrend Long lower shadow, little/no upper shadow, open = close at top Bullish Reversal Yes, next candle should close higher Gravestone Doji Uptrend Long upper shadow, little/no lower shadow, open = close at bottom Bearish Reversal Yes, next candle should close lower

Dragonfly Doji & Gravestone Doji Candlestick Patterns 🎯 Significance • Indicates a Possible Trend Reversal: o Dragonfly Doji: Suggests buyers regained control after a dip. o Gravestone Doji: Suggests sellers took over after a rally. • Key Reversal or Continuation Signal: Must be confirmed by the next candlestick. • Common at Market Tops & Bottoms: Often appears near support (Dragonfly) or resistance (Gravestone). This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Dragonfly Doji & Gravestone Doji Candlestick Patterns 🔍 Characteristics Dragonfly Doji (🐉 Bullish Reversal) ✅ Forms in a downtrend ✅ Long lower shadow (showing rejection of lower prices) ✅ Little or no upper shadow ✅ Open and close near the top of the candle ✅ Suggests bullish reversal when confirmed This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Dragonfly Doji & Gravestone Doji Candlestick Patterns 🔍 Characteristics Gravestone Doji (🪦 Bearish Reversal) ✅ Forms in an uptrend ✅ Long upper shadow (showing rejection of higher prices) ✅ Little or no lower shadow ✅ Open and close near the bottom of the candle ✅ Suggests bearish reversal when confirmed This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Dragonfly Doji & Gravestone Doji Candlestick Patterns 🧠 Psychology Behind the Patterns Dragonfly Doji (Bullish Reversal) • Sellers initially push the price down (creating a long lower shadow). • Buyers regain strength and push prices back up, closing near the open. • Signals strong buying pressure and possible reversal. • Bullish confirmation candle increases reliability. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Dragonfly Doji & Gravestone Doji Candlestick Patterns 🧠 Psychology Behind the Patterns Gravestone Doji (Bearish Reversal) • Buyers push the price up initially (creating a long upper shadow). • Sellers take control and push the price back down near the open. • Signals strong selling pressure and a potential trend reversal. • Bearish confirmation candle strengthens the signal. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Dragonfly Doji & Gravestone Doji Candlestick Patterns 📊 Volume Behavior • Dragonfly Doji: o High volume during the lower shadow formation suggests strong buying pressure. o Even higher volume on the confirmation candle confirms the reversal. • Gravestone Doji: o High volume during the upper shadow formation suggests strong selling pressure. o A high-volume bearish confirmation candle confirms the downtrend. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Dragonfly Doji & Gravestone Doji Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Aspect Dragonfly Doji 🐉 Gravestone Doji 🪦 Trend Context Downtrend Uptrend Indicates Bullish Reversal Bearish Reversal Market Psychology Buyers regain control Sellers take over Confirmation Needed? Yes, bullish close needed Yes, bearish close needed Volume Significance High volume strengthens bullish case High volume strengthens bearish case

Dragonfly Doji & Gravestone Doji Candlestick Patterns ✅ Conclusion The Dragonfly Doji and Gravestone Doji are powerful reversal candlestick patterns, but they must be confirmed by the next candle to ensure a reliable signal. Key Points to Remember: • Dragonfly Doji = Bullish Reversal (Downtrend to Uptrend) • Gravestone Doji = Bearish Reversal (Uptrend to Downtrend) • Shape matters: o Dragonfly Doji: Long lower shadow, close at top. o Gravestone Doji: Long upper shadow, close at bottom. • Confirmation is key: Next candle’s direction determines validity. • Volume adds credibility: Higher volume on the Doji and confirmation candle strengthens the reversal signal. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Long-Legged Doji Candlestick Pattern 📌 Key Takeaways 1. Indicates Extreme Market Indecision: Neither buyers nor sellers dominate, leading to a closing price near the opening. 2. Long Upper & Lower Shadows: Shows that price fluctuated significantly before settling back near the opening level. 3. Can Appear in Any Trend: o In an uptrend, it may signal a potential reversal or consolidation. o In a downtrend, it may indicate buyer interest and a possible trend reversal. 4. Confirmation is Crucial: The next candle determines if the market reverses or continues in the same direction. 5. Volume Matters: High trading volume strengthens the pattern’s significance, showing active market participation. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Long-Legged Doji Candlestick Pattern This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Long-Legged Doji Any Trend Long upper & lower shadows, open ≈ close Extreme Indecision, possible reversal or continuation Yes, next candle confirms direction

Long-Legged Doji Candlestick Pattern 🎯 Significance • Represents Market Confusion: Neither bulls nor bears hold clear control. • Key Reversal or Continuation Signal: o If found in an uptrend, it may signal buyer exhaustion and a potential reversal. o If found in a downtrend, it may indicate buyer interest and a possible reversal. o If found in a sideways market, it confirms consolidation. • Stronger when Appearing Near Key Levels: Works best near support/resistance zones or with additional confirmation from RSI, MACD, or trendlines. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Long-Legged Doji Candlestick Pattern 🔍 Characteristics ✅ Small real body (open ≈ close) ✅ Long upper & lower shadows (indicating price volatility) ✅ Can appear in any trend (uptrend, downtrend, or sideways) ✅ Neutral signal until the next candle confirms direction This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Where It Appears Meaning Uptrend Possible reversal if followed by a bearish confirmation Downtrend Possible reversal if followed by a bullish confirmation Sideways Market Continuation of consolidation 📌 Position & Importance

Long-Legged Doji Candlestick Pattern Psychology Behind the Long-Legged Doji • Buyers push the price up, creating a long upper shadow. • Sellers push the price down, creating a long lower shadow. • Closing near the open shows indecision in the market. • Traders wait for the next candle to confirm the direction of the trend . 📊 Volume Behavior • High volume suggests strong participation and increases the likelihood of a reversal. • Low volume suggests lack of commitment from both buyers and sellers, leading to continuation or sideways movement. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Long-Legged Doji v/s Other Candlestick Pattern This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Aspect Long-Legged Doji Standard Doji Dragonfly Doji Gravestone Doji Real Body Very small Almost nonexistent Almost nonexistent Almost nonexistent Shadows (Wicks) Long upper & lower Short wicks or none Long lower, no upper Long upper, no lower Indicates Extreme Indecision Indecision Bullish Reversal Bearish Reversal Confirmation Needed? Yes, next candle confirms Yes Yes, bullish close needed Yes, bearish close needed

Long-Legged Doji Candlestick Pattern ✅ Conclusion The Long-Legged Doji is a neutral candlestick pattern that signals market indecision. It can indicate a trend reversal or continuation, depending on the next candle’s direction. Key Points to Remember: • It has a small real body with long upper & lower shadows, showing a struggle between buyers and sellers. • It can appear in any trend (uptrend, downtrend, or sideways). • Confirmation is required—the next candle determines the market’s direction. • Volume strength can hint at whether the pattern is a reversal or just consolidation. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Doji Candlestick Pattern Comparison This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Doji Pattern Shape & Features Trend Context Market Signal Confirmation Required? Standard Doji Small body, short or no wicks Any Indecision Yes, next candle confirms trend direction Long-Legged Doji Small body, long upper & lower wicks Any Extreme Indecision Yes, strong signal when near key levels Dragonfly Doji Long lower wick, no upper wick, open = close at the top Downtrend Bullish Reversal Yes, next candle should close higher Gravestone Doji Long upper wick, no lower wick, open = close at the bottom Uptrend Bearish Reversal Yes, next candle should close lower Four-Price Doji No wick, open = high = low = close Low-volume markets Rare, very strong indecision Yes, rarely occurs in liquid markets

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Engulfing patterns are strong reversal candlestick patterns that indicate a potential shift in market momentum. They occur when a larger candle completely engulfs the previous candle, signaling a strong bullish or bearish move . 📌 Key Takeaways ✅ Engulfing patterns signal trend reversals – bullish in a downtrend, bearish in an uptrend. ✅ A larger second candle engulfs the previous one, indicating a shift in market control. ✅ High trading volume increases reliability of the pattern. ✅ Stronger when occurring near key support/resistance levels. ✅ Confirmation is required – the next candle should follow the engulfing direction.

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🎯 Significance of Engulfing Patterns 1. Bullish Engulfing appears in a downtrend and signals a potential uptrend. 2. Bearish Engulfing appears in an uptrend and signals a potential downtrend. 3. Indicates a shift in market sentiment, with strong participation from either buyers (bullish) or sellers (bearish). 4. More reliable on higher timeframes (Daily, 4H, Weekly). 5. Stronger when found near major support or resistance levels.

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🔍 Characteristics Bullish Engulfing ( Bullish Reversal) ✅ Forms in a downtrend. ✅ The second candle is bullish and completely engulfs the previous bearish candle. ✅ Opens lower and closes higher, showing strong buyer momentum. ✅ Reversal is confirmed if the next candle is also bullish. Bearish Engulfing ( Bearish Reversal) ✅ Forms in an uptrend. ✅ The second candle is bearish and completely engulfs the previous bullish candle. ✅ Opens higher and closes lower, showing strong selling pressure. ✅ Reversal is confirmed if the next candle is also bearish.

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Bullish Engulfing Downtrend Large bullish candle engulfs the previous small bearish candle Bullish reversal Yes, next candle should close higher Bearish Engulfing Uptrend Large bearish candle engulfs the previous small bullish candle Bearish reversal Yes, next candle should close lower

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Where It Appears Meaning Bullish Engulfing in Downtrend Strong reversal signal, buyers taking control Bearish Engulfing in Uptrend Strong reversal signal, sellers taking control Inside a Sideways Market Less significant, could be a fakeout 📌 Position & Importance

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Psychology Behind the Patterns Bullish Engulfing (Buyers Take Over) 🟢 • Sellers push the price lower initially, continuing the downtrend. • Suddenly, buyers step in with strength, reversing the momentum. • The second candle fully engulfs the first one, showing bullish dominance. • If confirmed, it signals the start of an uptrend. Bearish Engulfing (Sellers Take Over) 🔴 • Buyers push the price higher, continuing the uptrend. • Suddenly, sellers step in with force, reversing the momentum. • The second candle engulfs the first one, showing bearish dominance. • If confirmed, it signals the start of a downtrend.

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📊 Volume Behavior • High volume during the engulfing candle increases its reliability. • Bullish Engulfing with high volume → Stronger bullish reversal. • Bearish Engulfing with high volume → Stronger bearish reversal. • Low volume may indicate a weak signal, and the trend may continue instead of reversing.

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Bullish Engulfing vs. Bearish Engulfing Aspect Bullish Engulfing Bearish Engulfing Trend Context Downtrend Uptrend Indicates Bullish Reversal Bearish Reversal Market Psychology Buyers overpower sellers Sellers overpower buyers Confirmation Needed? Yes, next candle should close higher Yes, next candle should close lower Volume Significance High volume strengthens the bullish case High volume strengthens the bearish case

Bullish & Bearish Engulfing Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia ✅ Conclusion The Bullish and Bearish Engulfing Patterns are powerful reversal signals, but confirmation is crucial to avoid false signals. Key Points to Remember: • Bullish Engulfing = Bullish Reversal (Downtrend to Uptrend) 🟢 • Bearish Engulfing = Bearish Reversal (Uptrend to Downtrend) • The larger the engulfing candle, the stronger the signal. • Volume strengthens reliability – high volume means stronger reversal. • Confirmation is key – the next candle should continue in the engulfing direction.

Bullish & Bearish Harami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia The Harami candlestick pattern is a potential reversal signal, indicating a slowdown in the prevailing trend. It consists of two candles: 1. A large first candle that follows the trend. 2. A smaller second candle that is completely contained within the first candle’s body. It appears in both bullish and bearish forms . 📌 Key Takeaways ✅ Harami patterns signal potential trend reversals, but confirmation is needed. ✅ A smaller second candle inside the first one indicates a weakening trend. ✅ Less powerful than engulfing patterns, but still effective near support/resistance. ✅ High trading volume on the second candle increases reliability. ✅ Stronger on higher timeframes (4H, Daily, Weekly).

Bullish & Bearish Harami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🎯 Significance of Harami Patterns • Harami means “pregnant” in Japanese, referring to the smaller second candle being "inside" the first one. • It signals a loss of momentum in the current trend. • Bullish Harami appears in a downtrend, indicating potential bullish reversal. • Bearish Harami appears in an uptrend, indicating potential bearish reversal. • Works best when found near key support/resistance levels.

Bullish & Bearish H arami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 🔍 Characteristics Bullish Harami (Bullish Reversal) ✅ Forms in a downtrend. ✅ The first candle is large and bearish, continuing the downtrend. ✅ The second candle is small and bullish, completely inside the first candle. ✅ Indicates that sellers are losing strength, and a reversal may occur. ✅ Reversal is confirmed if the next candle is bullish. Bearish Harami (Bearish Reversal) ✅ Forms in an uptrend. ✅ The first candle is large and bullish, continuing the uptrend. ✅ The second candle is small and bearish, completely inside the first candle. ✅ Indicates that buyers are losing strength, and a reversal may occur. ✅ Reversal is confirmed if the next candle is bearish.

Bullish & Bearish Harami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Bullish Harami Downtrend Small bullish candle inside a larger bearish candle Potential bullish reversal Yes, next candle should close higher Bearish Harami Uptrend Small bearish candle inside a larger bullish candle Potential bearish reversal Yes, next candle should close lower

Bullish & Bearish Harami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Where It Appears Meaning Bullish Harami in Downtrend Possible reversal if buyers take control Bearish Harami in Uptrend Possible reversal if sellers take control Sideways Market Weak signal, may indicate consolidation 📌 Position & Importance

Bullish & Bearish Harami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Psychology Behind the Patterns Bullish Harami (Buyers Gaining Control) • The first candle is large and bearish, showing strong selling pressure. • The second candle is small and bullish, indicating that sellers are losing strength. • Traders watch for a third bullish candle to confirm reversal. Bearish Harami (Sellers Gaining Control) • The first candle is large and bullish, showing strong buying pressure. • The second candle is small and bearish, indicating that buyers are losing strength. • Traders watch for a third bearish candle to confirm reversal.

Bullish & Bearish Harami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia 📊 Volume Behavior • High volume on the second (smaller) candle strengthens the reversal signal. • Low volume on the second candle suggests market hesitation, needing more confirmation. • Bullish Harami with high volume → Stronger bullish reversal. • Bearish Harami with high volume → Stronger bearish reversal.

Bullish & Bearish Harami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Bullish Harami vs . Bearish Harami Aspect Bullish Harami Bearish Harami Trend Context Downtrend Uptrend Indicates Potential Bullish Reversal Potential Bearish Reversal Market Psychology Sellers losing strength Buyers losing strength Confirmation Needed? Yes, next candle should close higher Yes, next candle should close lower Volume Significance High volume strengthens the bullish case High volume strengthens the bearish case

Bullish & Bearish H arami Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia ✅ Conclusion The Bullish and Bearish Harami Patterns indicate trend slowdowns and potential reversals, but confirmation is key to avoid false signals. Key Points to Remember: • Bullish Harami = Possible Bullish Reversal (Downtrend to Uptrend) • Bearish Harami = Possible Bearish Reversal (Uptrend to Downtrend) • A smaller second candle inside the first one signals a weakening trend. • High volume on the second candle makes the pattern more reliable. • Confirmation is needed – the next candle should continue in the Harami’s direction.

Piercing Line & Dark Cloud Cover Candlestick Pattern Piercing Line and Dark Cloud Cover are two-candle reversal patterns that indicate a potential trend reversal. They are opposites of each other: • Piercing Line (Bullish Reversal) – Appears in a downtrend, signaling a bullish reversal. • Dark Cloud Cover (Bearish Reversal) – Appears in an uptrend, signaling a bearish reversal. Both patterns require confirmation from the next candle to validate the reversal. 📌 Key Takeaways ✅ Both patterns are trend reversal signals, but need confirmation. ✅ Piercing Line appears in a downtrend (Bullish Reversal). ✅ Dark Cloud Cover appears in an uptrend (Bearish Reversal). ✅ The second candle must cover at least 50% of the first candle’s body for validity. ✅ Higher trading volume on the second candle strengthens the pattern. ✅ Stronger when appearing near key support/resistance levels. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Piercing Line & Dark Cloud Cover Candlestick Pattern This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Piercing Line Downtrend Large bearish candle followed by a bullish candle that closes above 50% of the first Bullish reversal Yes, next candle should close higher Dark Cloud Cover Uptrend Large bullish candle followed by a bearish candle that closes below 50% of the first Bearish reversal Yes, next candle should close lower

Piercing Line & Dark Cloud Cover Candlestick Pattern 🎯 Significance of Piercing Line & Dark Cloud Cover Patterns • Piercing Line signals a bullish reversal by showing strong buying pressure after a downtrend. • Dark Cloud Cover signals a bearish reversal by showing strong selling pressure after an uptrend. • The second candle must cover at least 50% of the first candle’s body for a reliable signal. • More effective on higher timeframes (4H, Daily, Weekly). • Stronger near major support/resistance or Fibonacci levels. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Piercing Line & Dark Cloud Cover Candlestick Pattern 🔍 Characteristics Piercing Line (Bullish Reversal) ✅ Forms in a downtrend. ✅ The first candle is large and bearish, continuing the trend. ✅ The second candle is large and bullish, opening below the first but closing above 50% of its body. ✅ Indicates buyers stepping in and rejecting lower prices. ✅ Reversal is confirmed if the next candle is bullish . Dark Cloud Cover ( Bearish Reversal) ✅ Forms in an uptrend. ✅ The first candle is large and bullish, continuing the trend. ✅ The second candle is large and bearish, opening above the first but closing below 50% of its body. ✅ Indicates sellers stepping in and rejecting higher prices. ✅ Reversal is confirmed if the next candle is bearish. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Piercing Line & Dark Cloud Cover Candlestick Pattern Psychology Behind the Patterns Piercing Line (Buyers Taking Control ) 1. First Candle: Strong bearish candle suggests sellers are in control. 2. Second Candle: Market gaps down but buyers step in, pushing the price higher. Closing above 50% of the first candle’s body signals that buyers are strong . Dark Cloud Cover (Sellers Taking Control) 1. First Candle: Strong bullish candle suggests buyers are in control. 2. Second Candle: Market gaps up but sellers step in, pushing the price lower. 3. Closing below 50% of the first candle’s body signals that sellers are strong. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Piercing Line & Dark Cloud Cover Candlestick Pattern 📊 Volume Behavior • High volume on the second candle strengthens the pattern. • Piercing Line with high volume → Stronger bullish reversal. • Dark Cloud Cover with high volume → Stronger bearish reversal. • Low volume may indicate a weak signal, needing more confirmation . 📌 Position & Importance This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Where It Appears Meaning Piercing Line in Downtrend Strong reversal if buyers maintain momentum Dark Cloud Cover in Uptrend Strong reversal if sellers maintain momentum Sideways Market Less significant, may indicate consolidation

Piercing Line & Dark Cloud Cover Candlestick Pattern Piercing Line vs. Dark Cloud Cover This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Aspect Piercing Line Dark Cloud Cover Trend Context Downtrend Uptrend Indicates Bullish Reversal Bearish Reversal Market Psychology Buyers overpower sellers Sellers overpower buyers Confirmation Needed? Yes, next candle should close higher Yes, next candle should close lower Volume Significance High volume strengthens the bullish case High volume strengthens the bearish case

Piercing Line & Dark Cloud Cover Candlestick Pattern ✅ Conclusion The Piercing Line & Dark Cloud Cover Patterns are strong reversal signals, but confirmation is crucial to avoid false signals . Key Points to Remember: • Piercing Line = Bullish Reversal (Downtrend to Uptrend ) • Dark Cloud Cover = Bearish Reversal (Uptrend to Downtrend) • The second candle must cover at least 50% of the first candle’s body. • High volume on the second candle increases reliability. • Confirmation is key – the next candle should continue in the reversal direction . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Harami vs. Harami Cross Key Facts • Both are candlestick reversal patterns. • Formed by a large first candle and a small second candle. • The second candle is contained within the body of the first. • Harami Cross is a special type of Harami where the second candle is a Doji . • Require confirmation from subsequent candles . Interpretation & Trading Tips • Harami : Suggests trend weakening but requires confirmation. • Harami Cross: Stronger reversal signal due to the Doji . • Watch Volume: Higher volume on the second candle strengthens the signal. • Use Indicators: RSI, MACD, and moving averages help confirm reversals. • Stop-loss Placement: Above (Bearish) or below (Bullish) the pattern for risk management . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Harami vs. Harami Cross This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Feature Harami Harami Cross Pattern Type Reversal Stronger Reversal First Candle Large Bullish/ Bearish Large Bullish/ Bearish Second Candle Small-bodied (Green/Red) Doji (✝️) Indicates Uncertainty, potential trend shift High uncertainty, stronger reversal signal Market Sentiment Bulls/Bears losing strength Extreme indecision, possible reversal Reliability Medium (Needs confirmation) High (More reliable) Common Locations Support/Resistance, Fibonacci zones Key reversal areas

Morning Star vs. Morning Doji Star Key Facts • Both are bullish reversal patterns found at the end of a downtrend. • Consist of three candles: 1. First Candle: Large bearish (red) candle. 2. Second Candle: Small-bodied candle (key difference). 3. Third Candle: Large bullish (green) candle. • Indicate buyer strength returning. • Morning Doji Star is a special case of the Morning Star, where the second candle is a Doji . Interpretation & Trading Tips • Morning Star: Gradual shift from bearish to bullish; reliable but needs confirmation. • Morning Doji Star: Stronger signal due to the Doji’s representation of indecision. • Volume Matters: Higher volume on the third candle strengthens the signal. • Use Indicators: RSI divergence, MACD crossover, or moving averages for confirmation. • Stop-loss Placement: Below the second or first candle for risk management .

Morning Star vs. Morning Doji Star

Morning Star vs. Morning Doji Star Comparison Table Feature Morning Star Morning Doji Star Pattern Type Bullish Reversal Stronger Bullish Reversal First Candle Large Bearish (Red) Large Bearish (Red) Second Candle Small-bodied (Green/Red) Doji (✝️) Third Candle Large Bullish (Green) Large Bullish (Green) Indicates Gradual trend reversal Stronger indecision & reversal Market Sentiment Sellers losing control, buyers stepping in Extreme uncertainty, then strong buyer comeback Reliability High (Needs confirmation) Higher (More reliable) Common Locations Support zones, oversold levels Key reversal areas, oversold conditions

Evening Star vs. Evening Doji Star Key Facts • Both are bearish reversal patterns found at the end of an uptrend. • Consist of three candles: 1. First Candle: Large bullish (green) candle. 2. Second Candle: Small-bodied candle (key difference). 3. Third Candle: Large bearish (red) candle. • Indicate buyer weakness and seller strength returning. • Evening Doji Star is a special case of the Evening Star, where the second candle is a Doji , signaling extreme indecision. Interpretation & Trading Tips • Evening Star: Gradual shift from bullish to bearish; reliable but needs confirmation. • Evening Doji Star: Stronger signal due to the Doji’s representation of market indecision. • Volume Matters: Higher volume on the third candle strengthens the signal. • Use Indicators: RSI divergence, MACD crossover, or moving averages for confirmation. • Stop-loss Placement: Above the second or first candle for risk management.

Evening Star vs. Evening Doji Star

Evening Star vs. Evening Doji Star Comparison Table Feature Evening Star Evening Doji Star Pattern Type Bearish Reversal Stronger Bearish Reversal First Candle Large Bullish (Green) Large Bullish (Green) Second Candle Small-bodied (Green/Red) Doji Third Candle Large Bearish (Red) Large Bearish (Red) Indicates Gradual trend reversal Stronger indecision & reversal Market Sentiment Buyers losing control, sellers stepping in Extreme uncertainty, then strong seller comeback Reliability High (Needs confirmation) Higher (More reliable) Common Locations Resistance zones, overbought levels Key reversal areas, overbought conditions

Rising Window vs. Falling Window Key Facts • Rising Window and Falling Window are continuation patterns. • They are characterized by a price gap between two consecutive candles. • The gap represents strong market sentiment (bullish or bearish). • Found in trending markets and indicate a continuation of the trend . Rising Window (Bullish Continuation ) ✅ Occurs in an uptrend. ✅ A gap up forms between two consecutive candles. ✅ The second candle opens above the previous high and stays above it. ✅ Signals strong buying pressure and trend continuation. ✅ The gap acts as support—future price retracements may bounce off this level .

Rising Window vs. Falling Window Falling Window (Bearish Continuation) ❌ Occurs in a downtrend. ❌ A gap down forms between two consecutive candles. ❌ The second candle opens below the previous low and stays below it. ❌ Signals strong selling pressure and trend continuation. ❌ The gap acts as resistance—future price retracements may struggle to break this level.

Rising Window vs. Falling Window

Rising Window vs. Falling Window Interpretation & Trading Tips • Gaps act as support/resistance: If price retraces, watch for a bounce at the gap level. • Confirmation is key: Look for continuation candles or volume spikes for confirmation. • Volume matters: Higher volume on the breakout strengthens reliability. • Use indicators: Moving Averages, RSI, MACD, or Fibonacci retracements to confirm entries. • Stop-loss placement: o Rising Window: Below the gap or previous low. o Falling Window: Above the gap or previous high.

Rising Window vs. Falling Window Comparison Table Feature Rising Window Falling Window Trend Direction Uptrend (Bullish Continuation) Downtrend (Bearish Continuation) Gap Formation Price gaps up Price gaps down Market Sentiment Buyers in control Sellers in control Support/Resistance Gap acts as support Gap acts as resistance Signal Strength Strong if volume confirms Strong if volume confirms Best for Buying on pullbacks near the gap Selling on pullbacks near the gap

Tweezer Top & Bottom Pattern Key Facts • Tweezer patterns are dual-candle reversal patterns. • They indicate a potential trend reversal (bullish or bearish). • Both candles have similar highs (Tweezer Top) or lows (Tweezer Bottom). • Found in both uptrends and downtrends. • Stronger when occurring near key support/resistance levels . Interpretation & Trading Tips • Confirmation is key: A strong follow-up candle enhances reliability. • Use indicators: RSI divergence, MACD crossovers, and volume spikes improve accuracy. • Stop-loss placement: Above (Tweezer Top) or below (Tweezer Bottom) for risk management. • Best in confluence zones: Combine with trendlines, Fibonacci retracements, or moving averages . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Tweezer Top & Bottom Pattern Tweezer Top (Bearish Reversal) ✅ Appears in an uptrend. ✅ Consists of two candles with similar highs. ✅ First candle: Bullish (Green), showing strong buying. ✅ Second candle: Bearish (Red), rejecting higher prices. ✅ Signals selling pressure and potential reversal to a downtrend. ✅ Stronger near resistance levels . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Tweezer Bottom (Bullish Reversal) ✅ Appears in a downtrend. ✅ Consists of two candles with similar lows. ✅ First candle: Bearish (Red), showing strong selling. ✅ Second candle: Bullish (Green), rejecting lower prices. ✅ Signals buying pressure and potential reversal to an uptrend. ✅ Stronger near support levels.

Tweezer Top & Bottom Pattern Comparison Table This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Feature Tweezer Top ( Bearish) Tweezer Bottom ( Bullish) Trend Direction Uptrend → Downtrend Downtrend → Uptrend Candle Colors 1st Green, 2nd Red 1st Red, 2nd Green Highs/Lows Same Highs Same Lows Market Sentiment Buyers lose control, sellers take over Sellers lose control, buyers take over Confirmation Needed? Yes, watch next candles for follow-through Yes, watch next candles for follow-through Best Near Resistance levels Support levels

Bullish & Bearish Belt Hold Pattern Key Facts Belt Hold patterns are single-candle reversal patterns . They signal a potential shift in trend direction . Formed by a long-bodied candlestick with little to no wick on one side . Found in both uptrends and downtrends . Bullish Belt Hold Appears in a downtrend (bullish reversal signal ). Long bullish (green) candlestick with a small or no lower wick . Opens at the low and closes near the high . Suggests strong buying pressure . Stronger if it occurs near support levels . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Bullish & Bearish Belt Hold Pattern Bearish Belt Hold Appears in an uptrend (bearish reversal signal ). Long bearish (red) candlestick with a small or no upper wick . Opens at the high and closes near the low . Suggests strong selling pressure . Stronger if it occurs near resistance levels . Interpretation & Trading Tips Confirmation is key: Look for follow-up candles to confirm the trend reversal . Volume matters: Higher volume strengthens the pattern’s reliability . Use with indicators: RSI, MACD, or moving averages help validate signals . Stop-loss placement: Below (bullish) or above (bearish) the belt hold candle for risk management. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Bullish & Bearish Belt Hold Pattern Comparison Table . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Feature Bullish Belt Hold Bearish Belt Hold Trend Direction Downtrend → Uptrend Uptrend → Downtrend Candle Color Green (Bullish) Red (Bearish) Open Price Near the low Near the high Close Price Near the high Near the low Signal Strength Strong near support Strong near resistance Market Sentiment Buyers gain control Sellers gain control

Morning Star & Evening Star Candlestick Pattern The Morning Star and Evening Star are three-candle reversal patterns that indicate a potential trend reversal. They are among the most reliable candlestick patterns: • Morning Star (Bullish Reversal ) – Appears in a downtrend, signaling a bullish reversal. • Evening Star (Bearish Reversal) – Appears in an uptrend, signaling a bearish reversal. Both patterns require confirmation from the next candle to validate the reversal . 📌 Key Takeaways ✅ Both patterns are strong trend reversal signals, but require confirmation. ✅ Morning Star appears in a downtrend (Bullish Reversal). ✅ Evening Star appears in an uptrend (Bearish Reversal). ✅ The middle candle is small, showing market indecision. ✅ Higher trading volume on the third candle strengthens the pattern. ✅ Stronger when appearing near key support/resistance levels. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Morning Star & Evening Star Candlestick Pattern This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Morning Star Downtrend Bearish candle → Small indecision candle → Large bullish candle Bullish reversal Yes, next candle should close higher Evening Star Uptrend Bullish candle → Small indecision candle → Large bearish candle Bearish reversal Yes, next candle should close lower

Morning Star & Evening Star Candlestick Pattern 🎯 Significance of Morning Star & Evening Star Patterns • Morning Star signals a bullish reversal by showing that sellers are losing control and buyers are stepping in. • Evening Star signals a bearish reversal by showing that buyers are losing control and sellers are taking over. • The middle candle represents indecision, where the market slows before reversing. • More effective on higher timeframes (4H, Daily, Weekly). • Stronger near major support/resistance or Fibonacci levels. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Morning Star & Evening Star Candlestick Pattern 🔍 Characteristics Morning Star ( Bullish Reversal) ✅ Forms in a downtrend. ✅ First Candle: Large bearish candle, showing strong selling pressure. ✅ Second Candle: Small-bodied candle ( Doji /Spinning Top), showing indecision. ✅ Third Candle: Large bullish candle, confirming the reversal. ✅ Reversal is confirmed if the next candle is bullish. Evening Star ( Bearish Reversal) ✅ Forms in an uptrend. ✅ First Candle: Large bullish candle, showing strong buying pressure. ✅ Second Candle: Small-bodied candle ( Doji /Spinning Top), showing indecision. ✅ Third Candle: Large bearish candle, confirming the reversal. ✅ Reversal is confirmed if the next candle is bearish. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Morning Star & Evening Star Candlestick Pattern Psychology Behind the Patterns Morning Star (Buyers Taking Control ) 1. First Candle: Large bearish candle shows strong selling pressure. 2. Second Candle: Market slows down, indecision occurs. 3. Third Candle: Buyers step in strongly, pushing the price higher. Evening Star (Sellers Taking Control) 1. First Candle: Large bullish candle shows strong buying pressure. 2. Second Candle: Market slows down, indecision occurs. 3. Third Candle: Sellers take over, pushing the price lower. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Morning Star & Evening Star Candlestick Pattern 📊 Volume Behavior • High volume on the third candle strengthens the pattern. • Morning Star with high volume → Stronger bullish reversal. • Evening Star with high volume → Stronger bearish reversal. • Low volume may indicate a weak signal, needing more confirmation . 📌 Position & Importance This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Where It Appears Meaning Morning Star in Downtrend Strong reversal if buyers maintain momentum Evening Star in Uptrend Strong reversal if sellers maintain momentum Sideways Market Less significant, may indicate consolidation

Morning Star & Evening Star Candlestick Pattern Morning Star vs. Evening Star This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Aspect Morning Star Evening Star Trend Context Downtrend Uptrend Indicates Bullish Reversal Bearish Reversal Market Psychology Buyers overpower sellers Sellers overpower buyers Confirmation Needed? Yes, next candle should close higher Yes, next candle should close lower Volume Significance High volume strengthens the bullish case High volume strengthens the bearish case

Morning Star & Evening Star Candlestick Pattern ✅ Conclusion The Morning Star & Evening Star Patterns are strong reversal signals, but confirmation is crucial to avoid false signals. Key Points to Remember: • Morning Star = Bullish Reversal (Downtrend to Uptrend ) • Evening Star = Bearish Reversal (Uptrend to Downtrend) • Middle candle represents indecision and transition. • High volume on the third candle increases reliability. • Confirmation is key – the next candle should continue in the reversal direction. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Three White Soldiers & Three Black Crows Candlestick Patterns Three White Soldiers and Three Black Crows are powerful trend reversal patterns that indicate a shift in market sentiment. • Three White Soldiers (Bullish Reversal ) – Appears in a downtrend, signaling a bullish reversal. • Three Black Crows (Bearish Reversal) – Appears in an uptrend, signaling a bearish reversal. Both patterns consist of three consecutive strong candles that confirm a change in trend direction . This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Three White Soldiers & Three Black Crows Candlestick Patterns 📌 Key Takeaways ✅ Both patterns signal strong trend reversals with high reliability. ✅ Three White Soldiers appear in a downtrend (Bullish Reversal). ✅ Three Black Crows appear in an uptrend (Bearish Reversal). ✅ Each candle should have a long real body and small/no wicks. ✅ Stronger when supported by high volume. ✅ Can signal continuation when appearing after a brief pullback. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Three White Soldiers & Three Black Crows Candlestick Patterns This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Shape & Features Market Signal Confirmation Required? Three White Soldiers Downtrend Three consecutive strong bullish candles with minimal wicks Bullish reversal Yes, next candles should stay bullish Three Black Crows Uptrend Three consecutive strong bearish candles with minimal wicks Bearish reversal Yes, next candles should stay bearish

Three White Soldiers & Three Black Crows Candlestick Patterns 🎯 Significance of Three White Soldiers & Three Black Crows • Three White Soldiers signal a bullish reversal by showing that buyers are consistently gaining strength. • Three Black Crows signal a bearish reversal by showing that sellers are taking control. • Reliable when confirmed by high volume and appearing near key support/resistance levels. • More effective on higher timeframes (4H, Daily, Weekly). • Useful for trend confirmation in addition to reversal identification. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Three White Soldiers & Three Black Crows Candlestick Patterns 🔍 Characteristics Three White Soldiers (Bullish Reversal) ✅ Forms in a downtrend. ✅ Three consecutive bullish candles, each opening within the previous candle’s body and closing near the high. ✅ Minimal wicks, indicating strong buying pressure. ✅ Reversal is confirmed if the next candles stay bullish. Three Black Crows (Bearish Reversal) ✅ Forms in an uptrend. ✅ Three consecutive bearish candles, each opening within the previous candle’s body and closing near the low. ✅ Minimal wicks, indicating strong selling pressure. ✅ Reversal is confirmed if the next candles stay bearish. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Three White Soldiers & Three Black Crows Candlestick Patterns Psychology Behind the Patterns Three White Soldiers (Buyers Taking Control ) 1. First Candle: Buyers show strength after a downtrend. 2. Second Candle: More buyers join, pushing the price higher. 3. Third Candle: Confidence increases, confirming the uptrend. Three Black Crows (Sellers Taking Control) 1. First Candle: Sellers overpower buyers after an uptrend. 2. Second Candle: More selling pressure builds. 3. Third Candle: Bears confirm control, pushing the price lower. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Three White Soldiers & Three Black Crows Candlestick Patterns 📊 Volume Behavior • High volume on all three candles strengthens the pattern. • Three White Soldiers with high volume → Stronger bullish reversal. • Three Black Crows with high volume → Stronger bearish reversal. • Low volume may indicate a weaker trend change, needing further confirmation . 📌 Position & Importance This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Where It Appears Meaning Three White Soldiers in Downtrend Strong reversal if buyers maintain momentum Three Black Crows in Uptrend Strong reversal if sellers maintain momentum Sideways Market May indicate start of new trend

Three White Soldiers & Three Black Crows Candlestick Patterns Three White Soldiers vs. Three Black Crows This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Aspect Three White Soldiers Three Black Crows Trend Context Downtrend Uptrend Indicates Bullish Reversal Bearish Reversal Market Psychology Buyers overpower sellers Sellers overpower buyers Confirmation Needed? Yes, next candles should stay bullish Yes, next candles should stay bearish Volume Significance High volume strengthens the bullish case High volume strengthens the bearish case

Three White Soldiers & Three Black Crows Candlestick Patterns ✅ Conclusion The Three White Soldiers & Three Black Crows Patterns are strong trend reversal signals, but confirmation is crucial to avoid false signals. Key Points to Remember: • Three White Soldiers = Bullish Reversal (Downtrend to Uptrend ) • Three Black Crows = Bearish Reversal (Uptrend to Downtrend) • Each candle should have a long body and minimal wicks. • High volume on all three candles increases reliability. • Confirmation is key – the next candles should continue in the reversal direction. This Content is Copyright Reserved Rights Copyright 2025@PTAIndia

Reversal Patterns Psychology This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Psychology Behind Reversal Hammer Downtrend Sellers push the price down, but buyers regain control, rejecting lower prices. Hanging Man Uptrend Buyers push the price up, but sellers take control, indicating weakness. Shooting Star Uptrend Buying pressure is strong initially, but sellers overpower, leading to a potential downtrend. Morning Star Downtrend Bears dominate, indecision follows, then bulls take over with strength. Evening Star Uptrend Bulls dominate, indecision follows, then bears take over with strength. Engulfing Patterns Any Trend A strong opposite candle engulfs the previous candle, indicating a major shift in momentum. Three White Soldiers Downtrend Three consecutive bullish candles show strong buying pressure. Three Black Crows Uptrend Three consecutive bearish candles show increasing selling pressure.

Continuation Patterns Psychology This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Pattern Trend Context Psychology Behind Continuation Bullish Flag Uptrend Price pulls back slightly but finds support before resuming upwards. Bearish Flag Downtrend Price bounces slightly but faces resistance before continuing downward. Pennant Any Trend A brief period of consolidation before a sharp breakout in the trend’s direction. Rising Wedge Uptrend Price moves higher, but momentum weakens, leading to a breakout downward. Falling Wedge Downtrend Price moves lower, but buying pressure increases, leading to a breakout upward. Ascending Triangle Uptrend Buyers test resistance multiple times before breaking out. Descending Triangle Downtrend Sellers push prices lower multiple times before breaking down. Cup and Handle Uptrend A rounded bottom shows accumulation before a breakout.

🔍 Key Differences: Reversal vs. Continuation Psychology This Content is Copyright Reserved Rights Copyright 2025@PTAIndia Aspect Reversal Patterns Continuation Patterns Market Behavior Trend is losing strength, reversing direction. Trend pauses temporarily but resumes in the same direction. Trader Sentiment Shift in market control from bulls to bears (or vice versa). Traders take a break before pushing the price further. Volume Behavior High volume on the reversal candle confirms the trend change. Volume may decrease during consolidation but rise on breakout. Risk Factor Higher risk (fake reversals possible). Lower risk (trend already established). Best Confirmation Break of key support/resistance. Breakout from the pattern (flags, pennants, etc.).

Section 4 - Chapter 3 - Introduction to Candlestick Patterns

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Section 4 - Chapter 3 - Introduction to Candlestick Patterns

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