16 Candlestick patterns that every trader must know to make money

Those who have done encryption trading understand that the Candlestick Chart is the most intuitive language of price. But can you really read it?

What are the Candlesticks really saying?

Each Candlestick represents a price story over a period of time—four key points: open, high, low, and close.

Candlestick Body: The range between the opening and closing prices (green for rising and red for falling) Shadow: The part that exceeds the body of the candlestick in terms of high and low prices.

Japanese rice merchants invented this system, which later spread to the West. The advantages are obvious: it displays twice the amount of information compared to Candlestick Charts or bar charts.

6 Rebound Signals (Look for These at the Bottom)

Hammer Candlestick: The lower shadow is long, and the upper wick is small. The appearance at the bottom = bears are losing strength, bulls are about to counterattack.

Inverted Hammer: Conversely, the upper shadow is long. It is also a rebound signal, just with the direction reversed.

Bullish Engulfing: The small red candlestick is “eaten” by the large green candlestick. The stronger the force, the stronger the rebound.

Piercing Line: Red Candlestick + Green Candlestick opened with a gap. The momentum below turns upward.

Morning Star: A combination of three candlesticks (Red-Small-Green). Bearish end, bullish start.

Three White Soldiers: Three consecutive green Candlesticks, each opening higher and closing higher than the previous one. Pure bullish characteristic.

6 Types of Downward Signals (Top Protection Against These)

Hanging Line: Long lower shadow but closes at a medium level. Top appears = Bullish weakness, likely to drop.

Shooting Star: Long upper shadow, closing near the opening. Signs of bulls pushing up and then retreating.

Bearish Engulfing: A green candlestick is completely engulfed by a red candlestick. The stronger the force, the sharper the decline.

Evening Star: Three candles (Green - Small - Red). The opposite of bullish.

Three Black Crows: Three consecutive red Candlesticks, each making a new low. Pure bearish sentiment.

Dark Cloud Cover: A red candlestick moves from a high point into the lower half of a green candlestick. The bears are in control.

4 Neutral Signals (Continue Observing)

Doji: The candle body is nearly absent, with symmetrical upper and lower shadows. The market is in contemplation.

Spindle: The candle body is small, and the two shadow lines are roughly the same length. It also represents hesitation.

Three Falling Methods: A five-candlestick combination of red-green-green-green-red. A continuation pattern in a downtrend, where bulls cannot hold on.

Rising Three Methods: A five-candlestick combination of green-red-red-red-green. A continuation pattern in an uptrend, where the bears cannot turn the tide.

How to Make Money

Core Logic: Candlestick patterns ≠ 100% signals, it's just a probability game.

• Use technical indicators for secondary confirmation before entering.
• Start by learning from a single Candlestick, then combine your learning.
• Start practical training from small amounts
• Don't just look at the Candlestick Chart, combine it with support and resistance levels for doubled effects.

Remember: Candlestick patterns are useful in the cryptocurrency market, stock market, and foreign exchange. High volatility assets like BTC and ETH are most suitable for Candlestick analysis.

Insiders say: Traders who can read the Candlestick Chart clearly understand why they make or lose money.