Candlestick Patterns
Pure Price Action Reversal & Continuation
Candlestick patterns are not magic signals. They represent the battle between buyers and sellers. This module will teach you Doji, Hammer, Engulfing, Inside Bar, and advanced 3-candle reversal patterns with context rules.
What You Will Learn
Module 5 Lesson Map
Learn candlestick patterns with psychology + context rules.
Doji Types Simulation
Doji represents indecision. Different Doji types show different rejection behavior.
Doji Types
Context decides reversal probability.
Hammer vs Hanging Man Simulation
Same candle shape. Different meaning depending on trend direction.
Pattern Context
Meaning changes based on location.
Shooting Star Simulation
Shooting Star shows rejection from higher price levels.
Rejection Action
Sellers regained control.
Engulfing Pattern Simulation
Engulfing candle absorbs previous candle, showing strong momentum shift.
Engulfing Types
Confirmation candle improves accuracy.
Inside Bar vs Outside Bar Simulation
Inside Bar shows consolidation. Outside Bar shows volatility expansion.
Bar Patterns
đ Outside Bar = strong dominance candle.
Morning Star / Evening Star Simulation
Three-candle reversal patterns showing gradual momentum shift.
3 Candle Patterns
đ 2nd candle = indecision
đ 3rd candle = reversal confirmation
Tweezer Top / Bottom Simulation
Tweezer patterns show strong rejection at the same price level.
Tweezer Types
Market rejects twice from same zone.
Pattern Reliability + Context Rule Simulator
Patterns are only reliable when the right context is present. Tick the checklist and see reliability score.
Lesson 1: Doji & Its Types
Doji shows indecision between buyers and sellers.
Doji Psychology
- Open and close are nearly same
- Shows balance between demand and supply
- Near key levels, Doji becomes reversal signal
Doji Types
- Standard Doji = pure indecision
- Dragonfly = rejection from lows
- Gravestone = rejection from highs
Lesson 2: Hammer & Hanging Man
Same candle shape. Different meaning based on trend context.
Hammer (Bullish Reversal)
- Appears after downtrend
- Long lower wick shows rejection
- Buyers regain control near support
Hanging Man (Bearish Warning)
- Appears after uptrend
- Long lower wick shows selling pressure
- Reversal needs confirmation candle
Lesson 3: Shooting Star
Shooting Star shows rejection from resistance levels.
Pattern Meaning
- Long upper wick, small body
- Buyers pushed price up but failed
- Sellers took control by close
Lesson 4: Engulfing (Bullish / Bearish)
Engulfing candle absorbs previous candle completely.
Bullish Engulfing
- Appears after downtrend
- Green candle engulfs previous red candle
- Strong buying momentum shift
Bearish Engulfing
- Appears after uptrend
- Red candle engulfs previous green candle
- Strong selling momentum shift
Lesson 5: Inside Bar & Outside Bar
Inside Bar shows compression. Outside Bar shows expansion.
Inside Bar
- Current candle range is inside previous candle
- Represents consolidation
- Often breakout setup
Outside Bar
- Current candle breaks both high and low of previous candle
- Shows strong volatility and dominance
- Often trend continuation candle
Lesson 6: Morning Star / Evening Star
Three-candle patterns showing gradual reversal.
Morning Star (Bullish)
- Strong bearish candle
- Small indecision candle
- Strong bullish candle closing above midpoint
Evening Star (Bearish)
- Strong bullish candle
- Small indecision candle
- Strong bearish candle closing below midpoint
Lesson 7: Tweezer Top / Bottom
Double rejection at same high or same low.
Tweezer Top
- Two candles with same high
- Shows strong resistance
- Often reversal confirmation pattern
Tweezer Bottom
- Two candles with same low
- Shows strong support
- Often reversal confirmation pattern
Lesson 8: Pattern Reliability + Context Rule
Patterns work best only in the right environment.
Context Rule Checklist
- Pattern at strong S&R zone
- Higher timeframe alignment
- Trend exhaustion or breakout setup
- Confirmation candle required
- Risk-reward must be logical
Module 5 Quiz (Candlestick Patterns)
Test your intermediate candlestick pattern understanding.