Forex Reversal Candlestick Basic Patterns tips

Forex Reversal Candlestick Basic Patterns tips

A. Forex Reversal Candlestick Basic Patterns tips Doji

Doji describes the indecision in the market. There is no "real body" in this form. The opening price is the same closing price.

Doji is a turning point in the market, but it is an opportunity for the market to turn around. It is a moment of indecision, where the market is still confused at the price direction.

B. Forex Reversal Candlestick Basic Patterns tips Hammer and Hanging Man

Hammer and hanging man pattern have the same model. What makes them different is just where they are on the table. Hammer finishes down trends that stops down the trends to go further. Meanwhile, the man hanging ends trends are trends to stop to go further.

Both of them (the hammer and hanging man) have two kinds of form:

Hammer

Hammer Candlestick empty

There is buying pressure hammer candlestick which make the closing price is above the opening price.

According to the theory Munehisa Homma, this model will be followed by a bullish pattern.

With Hammer Candlestick shadow

But what happens when a hammer pattern is a shadow (not empty beacon)? Well, there is still pressure to buy time, but not as strong as they've been discussed in the previous example. This time, the closing price is below the opening price.

According to the theory Munehisa Homma, this model will be followed by a bullish pattern but is much shallower angle than the previous.

Hanging Man

Hanging Man Candlestick with shadow

There is selling pressure on the hanging man candlestick which make the closing price is below the opening price.

According to the theory Munehisa Homma, this model will be followed by a bearish pattern.

Forex Reversal Candlestick Basic Patterns tips Hanging Man Candlestick empty

But what happens when a man hanging pattern is empty (not shaded lamp)? Well, there is still pressure sales period, but not as strong as they've been discussed in the previous example. This time, the closing price is above the opening price.