Tuesday, 31 December 2019

5 Candlestick patterns that are popular among Traders

The crypto exchange has only just developed in the last few years. Unlike forex, cryptocurrency has a different pattern in the market. It could be that the price of crypto has doubled, or even gone far worse. Cryptocurrency trading is considered very risky, especially for beginners. How to anticipate the disadvantages of trading crypto, then we need to master a little trading strategy with candlestick patterns.


Charts with candlesticks reflect short-term views, sometimes lasting less than 10 trading sessions. Candlestick is a very complex system and sometimes difficult to understand. Every Trading Strategy With a Candlestick Pattern
Each candlestick consists of a real body / candle stick and wick. A candle-like body reflects the difference between the open and close prices in that period. Open and close prices are prices


 first and last transaction for that period. When there is no body or is very small, it means that the open is almost the same.
The bars are colored and depend on the scheme used by the charting platform. Generally white and black, green and red. White or green candlesticks mean the price finishes higher during that time period. Where the closing price is above the open price. Whereas black or red candlesticks mean the price is finished lower during that time period. candlesticks represent a certain time, the popular time frame is usually 1 minute and 5 minutes.


Accurate Candlestick Patterns

There are practical ways that can be applied easily in trading strategies with candlestick patterns. Among them are strategies with Inverted Hammer, Bullish Engulfing, Piercing Line patterns. Morning Star, and Three White Soldiers. The following is a brief explanation of the five patterns:

1. Inverted Hammer

Hammer is a bullish reversal pattern, which indicates that a trade is approaching the lowest level in the downtrend. Whereas Inverted Hammer is formed in a downtrend and represents a tendency to reverse direction or a trend begins to rise.

2. Bullish Engulfing

Bullish Engulfing is a reversal pattern of two candles, where the second candle engulfs the original body of the first candle, regardless of the axis length. This pattern usually appears in a downtrend and is a combination of one dark candle followed by a larger white candle.

3. Three White Soldiers

Well, this pattern is usually observed after a downtrend period. As the name suggests, Three White Soldiers consist of three long white candlesticks which get higher and continue in the next trade. Any candle higher than the previous opening indicates a steady rise in buying pressure. But be careful, when white candles appear too long it will only create short sales that can cause landslide prices.

4. Piercing Line

Similar to the Engulfing pattern, the Piercing Line is a two candle upside down pattern that occurs when a downtrend. The first long black candle is followed by a white candle lower than the previous closing. Usually white candles appear when buying pressure pushes prices up by half or two thirds of the body of a black candle.

5. Morning Star

Morning starr is a new beginning that occurs when a downward trend. Note that this pattern consists of three candles, one short candle (doji) appearing between the black candle and the white candle. There was no overlap between the body of the doji and the previous black candle. These signs indicate that the previous selling pressure has subsided. And the third white candle shows new buyer pressure and the start of a Bullish reversal.

Related Post

Post Top Ad

Your Ad Spot

Pages

close