Introduction to Candlesticks – Single Candlestick Patterns

By Trader Pit

July 9, 2021


Candlestick patterns are well known to professional traders. The most widely known of them all is the Double Top or “Head and Shoulders” pattern.  In this article, we will look at one of the most common and reliable patterns, the Hammer or Flick.

Within the world of technical analysis, candlestick charts, or Japanese candlesticks, are used to depict the price of a security on an exchange (and later on, the stock market). They are extremely versatile and can be used to plot a variety of price data, not just the open, high, low, and close.

A guide to individual candle patterns: If you want to become a successful trader in the stock market, it is very important to learn how to read and understand candlesticks. These candlesticks are essentially a type of technical chart used to describe the price movement of a stock, derivative or currency. Understanding candlesticks and their patterns can help you identify entry and exit points for your trades.

I’m just waiting for the money to arrive and I just have to take it. I’m not doing anything now. – Jim Rogers

In this article, we’ll have a look at what candlesticks are and subsequently at the popular individual candlestick patterns every trader should know. Let’s get started.

Introduction to Candlesticks

What are candlesticks or candles?

Candlesticks are the most common form of market trend analysis, historical analysis and future forecasting. They are the most powerful form of technical indicators. Just as a burning candle illuminates the present and the future, so candles with their patterns illuminate the present and help to understand future trends.

A single candle indicates events that occurred during the chosen time period. It shows us the opening, maximum, minimum and closing of the day (in the chosen time frame). The length of the candle helps us understand the volatility of the day. The longer the candle, the more volatile the day, and the shorter the candle, the less volatile the day.

A candlestick can be called a historical indicator because candlesticks are formed on market actions that already have taken place. But shaped candlesticks help to understand future trends and price patterns.

Before we get into the different candle patterns, I recommend you consider the following factors:

  1. The trend is your friend. Don’t work against the trend.
  2. A man must be very flexible in his views. Stubbornness usually leads to disaster.
  3. Analysis of historical data helps to understand future price trends.
  4. Avoid directional action on small candles. In general, trends are formed after candles of considerable duration.

Single light model

Simply put, a single candle model is formed by a single candle. Here we do not take into account multiple or a group of candlesticks, and the trading signal is generated based on the trading actions of a single day. Below are some of the most popular designs of single candlesticks that we will discuss in this article: Spinning top, Marubuso, Doji, Hammer, Hanging man, Shooting star.

Frequently Asked Questions

What is a single candlestick pattern?

A single candlestick pattern is a pattern that is created by a single candlestick.

How do you read single candlesticks?

The single candlestick is the most basic candlestick pattern. It consists of a long body and a short body. The long body is the upper part of the candlestick, and the short body is the lower part of the candlestick. The upper body typically has a long wick and the lower body has a short wick. The long wick indicates that the price of the stock is rising, and the short wick indicates that the price of the stock is falling.

How do I learn candle patterns?

Candle patterns are a great way to learn how to read the cards. With a little practice, you will be able to see the patterns and learn how to read the cards with ease.

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About the author

Trader Pit

A yogi who like Finance and Technology. I have been in Indian Stock market for over 12 years now as financial analyst, portfolio manager, trader. Now, I focus on Yoga, Financial Education & Long term investing. 

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