10 candlestick patterns that EVERY trader must master: practical guide from scratch

Japanese candles are the language of the market. Each one tells a story: where it opened, where it closed, and what happened along the way. Their shape and color reveal whether buyers or sellers had control. Mastering these 10 patterns is the difference between trading blindly and reading the market's mind.

1. Bullish engulfing: when buyers regain control

Imagine this: the market opens below the previous close, but suddenly buyers arrive and push it up, closing higher than the previous day. A small red candle is engulfed by a large green one. That is a bullish engulfing, and it marks the possible bottom of the market.

The data speaks: A study from the University of Michigan (2018) recorded a 65% accuracy in predicting increases.

2. Bullish Harami: the indecision that precedes the change

Two candles: first a large red one, then a small green one inside it. The market is confused, sellers are losing strength, buyers are entering slowly. It is a reversal in the making.

According to Bulkowski: 54% success rate. It is not the most reliable, but when combined with other indicators, it works.

3. Lower clamp: the support that does not yield

Two or more candles with identical lows. The price hits the same support level over and over again, but does not fall further. Sellers tire out, buyers hold firm. It's as if the market is saying: “you shall not pass here.”

Success Rate: 61% according to Bulkowski. The market is in bearish exhaustion.

4. Morning Star: three candles, a clear reversal

A strong bearish candle, followed by a small (doji) that shows indecision, and finally a strong bullish candle. Sellers give up on the second candle, buyers attack on the third.

Performance: 65% accuracy (Park & Irwin). It is one of the most reliable patterns.

5. Morning star doji: the turbocharged version

Like the morning star, but with the guarantee of a doji in the middle ( candle with an almost invisible body ). The clearer the signals, the better the pattern.

Fascinating data: A 10-year study (2012-2021) showed 68% accuracy. That is, if you see this, bet big on the upside.

6. Abandoned Baby Bullish: Gaps and Radical Change

Three candles with a key detail: gaps (gaps). The first is bearish, the second opens below (gap down) and is a doji, the third opens above (gap up). Sellers were caught off guard.

Aronson Study: 66% success in the US stock market. Gaps don't lie.

7. Three out up: total dominance of the bulls

First red candle, second green candle completely wraps it, third green candle opens higher and closes higher. The bears were crushed in the second candle, the bulls celebrate in the third.

Accuracy: 70%. One of the most bullish patterns that exist.

8. Three from the inside out: moderate but solid reversal

Strong red, small green ( falls within the range of the red ), strong green. It's not as explosive as “three out”, but it remains reliable (64% accuracy according to Lo, Mamaysky & Wang ).

9. Bullish Kicker: the shift in sentiment in two candles

A bearish red candle, immediately followed by a green candle that opens with a bullish gap and closes higher than the maximum of the previous red one. It's a punch from the bullish market in the face of the bears.

CXO Advisory Group: 68% accuracy. When you see this pattern, the momentum is in favor of buyers.

10. Piercing Line: the candle that penetrates the resistance

Red candle, then green candle that opens below the minimum of the red one but closes above its midpoint. Sellers thought they had it, but buyers counterattacked.

Success rate: 60% (Project TAST). Less spectacular, but a clear sign of resurgence.

The key for beginner traders

These 10 patterns are not magic: they are evidence that the market is changing hands. Use the combination of:

• Candle pattern (what you see)
• Volume (how many people participate)
• Support/resistance level ( where do other traders think is important )

Mastery is not remembering 100 patterns. It is recognizing these 10 quickly, waiting for confirmation, and acting with discipline. The rest is risk management.