Introduction to Candlestick Patterns and Chart Patterns

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Introduction To Chart Patterns

T he chart pattern paints a picture of various factors such as buying, selling, boom, and bust between players and who wins in the end. This shows that traders and investors are taking their own position. With the help of chart pattern analysis, it is possible to predict the short duration and long duration trend. The two main facts about technical analysis are that prices show trends and history repeats itself. An upward momentum indicates that the demand factor is strong while a downward momentum indicates that the supply factor is strong. The Range-Bound Market indicates a lack of trend. Aside from the channel pattern, the rest of the patterns can be divided into two types of patterns. 01. Reversal Pattern. 02. Continuation Pattern. 01. Reversal Pattern : When a reversal signal structure is formed, there is an indication that the trend will be reversal after a steady rise or fall in the shares or the market. It should always be kept in mind that the right decision can be made imm

CHAPTER 04: STAR

01. M orning Star : This is a candlestick pattern consisting of three candles indicating an uptrend. When a recession is established, it consists of a red candle that accompanies the current downward trend of the previous day. The next day the price opens downwards in the gap and on that day the price stays in a limited range and closes. On the third day, the price opens in the gap with the correction and closes with the correction when the long green candle of the bulls is formed. This third-day candle is seen closing or coming up around the center of the first-day candle . This trend seems to be accelerating after the signal of reversal. In the chart above we see the Morning Star pattern. After that, we can see the price improving as a result. 02. E vening Star : This is a candlestick pattern consisting of three candles indicating downward momentum. The first of these candles is the long green candle that comes with the current upward momentum or an uptrend. The next day the price ga

INVERTED HEAD AND SHOULDER PATTERN.

T he head and shoulder pattern is often inverted, which we also call the I nverted head and shoulder pattern . This structure appears to be formed mainly in a downward trend. From this, it can be said that the bears are tired now and the bulls have jumped to buy. The left shoulder was formed first due to the bullish momentum in the inverted head and shoulder pattern. But the downward momentum comes back and the left shoulder is formed completely. When the left shoulder is formed, the price creates a new low but with a lower volume than the left shoulder. When the left shoulder is formed, the price gives a new low and the bulls start a sharp drag and a good pullback comes which goes up to the neckline. Which we can call the Head. Now due to limited supply, the price goes down a bit and takes support on or near the neckline. We can call this Right shoulder. The right inverted shoulder is formed and the price starts rising again. When the right inverted shoulder is formed, it increases

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