There are so many different candlestick patterns and some are more reliable than others. Listed below are a few that you may find of interest.

Bullish and Bearish Engulfing

A Bullish Engulfing (BuE) and Bearish Engulfing (BrE) pattern tend to work quite well in the vicinity of support and resistance levels and at the end of a minor trend. We ideally want to use these in the direction of the main trend.

During a primary uptrend, a minor pullback to a support zone and BuE pattern would be a reason for a long consideration.

During a primary downtrend, a minor snapback to a resistance zone and BrE pattern would be a reason for a short consideration.

While a textbook defines a BuE or BrE as the body (open to close) engulfing the prior body, we ideally want to see the range (high to low) of the prior range engulfed also. This is not essential but more of a preference.

Tramtracks

These are similar in design to engulfing candles, but the open and closing levels are at similar levels bouncing off a support or resistance level.

Doji

Probably the most common of candlestick patterns is a Doji.

For a Doji to be significant and to work, it first needs to be the extreme candle. So during a pullback/snapback, the Doji has to be the extreme candle and preferably near a support/resistance level.

Dragonfly (also sometimes known as butterfly) Doji and Gravestone Doji at the end of trends are generally good turnaround trend candidates. Regardless of the type of Doji, the range of the bar should be equal to the range of the surrounding bars if not greater.

It is important to understand that Candlesticks are a just moment in time. They offer a snapshot of that price bar only. Using this alongside additional information in our analysis allows us to see a bigger and better picture of where price may go from here.

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