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Cheat Sheet Candlestick Patterns: Excel your trades

Candlestick patterns cheat sheet

The Japanese candlestick charts have become integral to stock market analysis because of their easy-to-read and identifiable patterns. A candlestick patterns cheat sheet combines all the chart patterns that can emerge on the screen. 

Since there are various patterns, a cheat sheet helps traders track what each pattern represents. Besides providing a gist of the market or asset price movements, the exciting patterns make the chart fun to analyse. 

But before understanding the candlestick chart patterns cheat sheet, it’s important to grasp the basics of Japanese candlestick charts. 

What is the Japanese Candlestick Chart?

The Japanese candlestick chart acts as a price indicator that helps traders analyse a stock or asset’s high and low price points or opening and closing prices. It’s called a candlestick pattern because it resembles a candle with a wick either pointing upward or downwards. The patterns emerge in two primary colours, red and green. The former indicates the price is going down, while the latter indicates the asset price is increasing. 

Bullish Candlestick Pattern 

A bullish pattern, also known as a shooting star pattern, indicates an uptrend in the market, which means the asset price increases. This pattern is easy to identify as it appears like a candle with a long wick pointing downward. 

Candlestick patterns Bullish hammer

Bearish Candlestick Pattern 

It’s the contrast of the bullish pattern, also known as bullish reversal or inverted hammer pattern, which indicates a downtrend in the market. This pattern appears just before a bullish reversal or market uptrend, and if the symbol after this is a bullish pattern, traders should buy the asset. 

Candlestick patterns bearish hammer

What is a Cheat Sheet Candlestick Pattern?

Now that you understand what a Japanese candlestick pattern is, the cheat sheet comes in handy to keep track of these patterns. A candlesticks pattern cheat sheet is similar to an examination cheat sheet, giving a gist or glimpse of a more significant concept. You can check out the trading candlestick patterns cheat sheet pdf from here

Candlestick pattern cheat sheet

What is a Single Candlestick Pattern?

A candlestick pattern cheat sheet includes all the single, double and triple candlestick patterns. These are different types of patterns represented by the number of candle signs. A single candlestick pattern includes one candle, showing that the chart is based on one trading day. You can check out the patterns in the image below or opt for educational resources offered by Botbro Broker to understand this tool better. 

Single Candlestick pattern

What is a Double Candlestick Pattern?

When the change in the chart pattern is represented by a change in two candlesticks, it’s a double candlestick pattern. There are several double candlestick patterns, like a Bullish Kicker, a bearish pattern followed by a bullish pattern, and a bearish kicker, which is vice versa. Then, there’s bullish and bearish engulfing, in which one candle overshadows the other, as shown in the image below. 

Double Candlestick pattern

Bullish Harami is when a sizable bearish pattern appears before a small bullish; on the contrary, when a short bearish pattern follows a large bullish pattern, it’s called Bearish Harami. The Japanese meaning for Harami is ‘pregnant’, which means the pattern resembles a pregnant lady. Tweezer bottoms and tops are short-term bullish and bearish patterns, respectively. 

What Are Triple Candlestick Patterns?

Like other patterns, a triple candlestick refers to a change in chart pattern through three candles. Morning Stars, Abandoned Baby, White Soldiers, and Black Crows are some of the triple candlestick patterns. Check out others in the image below or the cheat sheet for the bullish candlestick patterns. 

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What Are Confirmations?

As the names suggest, these patterns confirm traders’ analysis of whether the asset has the potential to grow or fall. These patterns usually combine three candlesticks that help confirm if the market is in an uptrend or downtrend. 

candlestick pattern triple hammer

How to Read Cheat Sheet Candlestick Pattern?

Identifying the candlestick patterns might be easy, but analysing them is difficult; you can opt for platforms like metherworld broker to access this analytical tool. Follow the steps given below to learn how to read a candlestick pattern:

Step 1: Colour

Identify the candle colour of your focussed stock or assets, whether red or green. Understanding the colour sets the market’s tone, whether on an uptrend or downtrend because a green candle indicates a bullish trend and a bearish trend is indicated by a red candle.

Step 2: Body

The body of the candle pattern helps determine the position of the candle’s opening and closing prices. It’s important to carefully examine the pattern since opening and closing price positioning provide crucial information about the market dynamics. You must check whether the body is in the middle, at the bottom or the top.

Step 3: Wick

Next, you should observe the upper and lower wicks’ lengths to determine the high and low points. The length of the wicks shows the highest and lowest points attained throughout the trading session. By analysing the wicks, you can understand the range and extremes of price fluctuations in the stock or currency market. 

Step 4: Timeframe

It’s important that you consider the timeframe while reading the charts, as it could be a weekly, monthly, yearly or daily chart. Since the significance of candlestick patterns varies with time, taking into account the selected timescale (daily, hourly, etc.) is important. 

Cheat Sheet Bullish Candlestick Patterns

All the patterns that indicate an upcoming bullish reversal and a boost in the market prices are considered bullish patterns. The Patterns like a hammer, morning star, bullish Harami, bullish engulfing, three white soldiers etc., are counted as bullish candlestick patterns. To better understand these patterns, you can download a cheat sheet, bullish candlestick patterns pdf from free websites. 

Cheat Sheet Bearish Candlestick Patterns 

A bearish pattern on the chart means it is bad news as it indicates a potential decline in the asset price. So when this pattern appears, traders should avoid buying the asset and sell it if they own any. It includes patterns like the shooting star, bearish engulfing, three black crows, bearish Harami etc. 

Conclusion 

The cheat sheet is a sheet that includes all the possible patterns that are formed in a candlestick chart, which traders use to carefully analyse the patterns. This way, you can know what is happening in the trading market and make smart and informed decisions. These patterns originated in Japan and became one of the best market and asset analysis tools. So, memorize these patterns or peek at your cheat sheet and make analysing chart patterns fun! Explore other market analysis tools offered by TradeEU broker

FAQs

Which candlestick pattern is most reliable?

The best candlestick pattern to choose relies on many variables and the state of the market. However, patterns such as the “Hammer”, “Engulfing”, and “Harami” patterns are frequently seen as strong predictors.

What is the difference between bullish and bullish reversal?

A bullish pattern, such as the “Three White Soldiers,” denotes an upward trend. On the other hand, a bullish reversal pattern, like “Bullish Engulfing,” indicates that an upswing is about to replace a downward trend.

Which pattern is also called the shooting star?

The “Shooting Star” candlestick pattern is characterized by a lengthy upper wick and a tiny body, which indicates a negative outlook. It frequently denotes a possible turn in the bear market.

How do you find the Forex candlestick patterns cheat sheet?

The cheat sheets can be easily found online as multiple websites offer free Forex candlestick patterns cheat sheet pdf for download.

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Karla brings over 16+ years of experience in the online brokerage industry. She is a finance graduate from Birmingham University, UK, and a forex market enthusiast. Being a true writing fanatic, she pens research-backed reviews for traders to analyse trading strategies and indicators. She has also authored a wide range of educational articles covering the forex industry. Karla is quite interested in checking brokerage companies and studying their performance and growth. Her aim is to describe complex investment mechanisms in an accessible way for traders of any level. Apart from finance, her interests mainly include reading books, fitness, and writing in her journal. Karla believes in the power of writing and wants to write for every layman who knows nothing about finance.
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