Candlestick Patterns: Part 2

Hey friends, welcome to Stock’s Knows. This is the 2^nd part of candlestick pattern article. In this article will understand candlestick patterns formed by 2 candlesticks.

  1)Bullish Engulfing:

  Bullish Engulfing candlestick pattern forms by 2 candles, the first candle is generally small and bearish, the 2^nd candle is bullish and long. 2^nd candle engulfs the first one. This type pattern is known as a Bullish Engulfing pattern. It is a bullish reversal pattern and in most of the cases, it found near the bottom at the end of the downtrend. If next candle closes above the high of a 2^nd candle, it clearly indicates upcoming uptrend. 

  2)Bearish Engulfing:

  It is also two candle pattern. The 1^st candle is always small and bullish, a 2^nd candle is long and bearish. 2^nd candle fully engulfs the first one. It majorly forms at the end of uptrend hence it is a bearish reversal pattern. When 3^rd candle will close below the low of the 2^nd candle, it clearly indicates an upcoming downtrend.

 3)Bullish Harami:

 Bullish Harami pattern is a mirror image of the bullish engulfing pattern. In bullish harami pattern, the 1^st candle is long and bullish. The 2^nd candle is small and bearish. A 2^nd candle always in between high and low of the first candle. It forms generally at the bottom, end of the downtrend. It is a bullish reversal pattern. If 3^rd candle closes above 1^st candle’s high, it clearly indicates upcoming uptrend.

4)Bearish Harami:

Bearish Harami pattern is the mirror image of the Bearish Engulfing pattern. The 1^st candle is always long bearish candle and the 2^nd candle is always small bullish candle. 2^nd candle forms in between High and low of the 1^st candle. It is bearish reversal pattern and forms generally at the end of an uptrend. If 3^rd candle closes below Low of the 1^st candle, it is clear indication of the upcoming downtrend.

5)Dark cloud cover:

Dark cloud cover is also bearish candlestick pattern. In this pattern, the 1^st candle is a strong bullish candle, but the 2^nd candle is a strong bearish candle and opens above the high of the 1^st candle, close below the midpoint of the first candle. It forms near the resistance zones.

6)Piercing Line candlestick pattern:

Piercing Line pattern is just mirror image of Dark cloud cover pattern. The first candle is always strong bearish candle and 2^nd candle open below the low of the 1^st candle and close above the midpoint of the 1^st candle. It is a bullish reversal pattern. It generally forms near the support zone.

7)Tweezer tops:

The tweezer top is the bearish reversal pattern. A 1^st candle is the strong bullish candle and closes at high. The 2^nd candle is a bearish pattern and opens at high-level decrease to a lower level. Highs of both candles are almost same. It generally forms at the end of an uptrend.

8)Tweezer bottoms:

The tweezer bottom is the bullish reversal pattern. The 1^st candle is the strong bearish candle, close at the low level. 2^nd candle open at low and increase from that level and close near high. Lows of both candles are almost same. It generally forms around support zones and at the ending of the downtrend.

This was the 2^nd part of candlestick pattern article. In 3^rd part, we will understand about candlestick pattern formed by more than two candles. If you find helpful above information then please Share our article and Subscribe to the newsletter of our blog.