Chart Reference Guides

Candlestick and chart patterns explained with diagrams, meaning and confirmation signals.

Candlestick Patterns Explained

Single and multi-candle shapes that describe who was in control of a session. Read the diagram first, then the confirmation you should wait for.

Hammer

Bullish

Sellers pushed price down hard, buyers took it all back before the close.

Confirmation
Appears after a decline; wait for the next candle to close above the hammer's high.

Inverted Hammer

Bullish

A failed push higher after a decline — but sellers could not regain control.

Confirmation
Needs a strong bullish close on the following candle.

Hanging Man

Bearish

Selling appeared inside an uptrend, even though price recovered by the close.

Confirmation
Only meaningful after a rally; confirm with a lower close next candle.

Shooting Star

Bearish

Buyers ran price up and were rejected, closing near the open.

Confirmation
Look for a bearish follow-through candle and a failed retest of the high.

Bullish Engulfing

Bullish

A large up candle completely covers the previous down candle's body.

Confirmation
Strongest at support, with the close above the prior candle's open.

Bearish Engulfing

Bearish

A large down candle swallows the previous up candle's body.

Confirmation
Most reliable at resistance after an extended move higher.

Doji

Neutral

Open and close are almost identical — the market is undecided.

Confirmation
Trade the break of the doji's range, not the doji itself.

Spinning Top

Neutral

A small body with wicks both sides: momentum is fading.

Confirmation
Treat as a pause. Wait for the next decisive close.

Morning Star

Bullish

A long down candle, a small indecisive candle, then a strong recovery.

Confirmation
Third candle should close well into the first candle's body.

Evening Star

Bearish

A rally stalls on a small candle, then reverses sharply.

Confirmation
Third candle should close deep inside the first candle's body.

Piercing Line

Bullish

Price gaps lower then closes above the midpoint of the previous candle.

Confirmation
The close must clear halfway up the prior red body.

Dark Cloud Cover

Bearish

An upward gap is sold into and closes below the previous midpoint.

Confirmation
The close must drop below halfway down the prior green body.

Three White Soldiers

Bullish

Three strong up candles in a row, each closing near its high.

Confirmation
Look for rising closes and small upper wicks.

Three Black Crows

Bearish

Three consecutive down candles, each closing near its low.

Confirmation
Falling closes with small lower wicks signal sustained selling.

Bullish Marubozu

Bullish

A full-bodied candle with no wicks — buyers controlled the whole session.

Confirmation
Strong continuation signal when it breaks a level you already track.

Tweezer Bottom

Bullish

Two candles reject the same low, showing buyers defending a level.

Confirmation
Needs a close above the second candle's high.

Chart Patterns Explained

Larger structures that build over many candles. Dashed lines show the level that turns each shape into a tradable signal.

Neckline

Head and Shoulders

Bearish

Three peaks with a higher middle peak — the trend runs out of buyers.

Confirmation
Break and close below the neckline drawn under the two troughs.

Neckline

Inverse Head and Shoulders

Bullish

Three troughs with a deeper middle trough — sellers exhaust themselves.

Confirmation
Break and close above the neckline drawn over the two peaks.

Support

Double Top

Bearish

Price fails twice at the same level, forming an M shape.

Confirmation
Close below the middle trough; retests of it often hold as resistance.

Resistance

Double Bottom

Bullish

Price holds the same low twice, forming a W shape.

Confirmation
Close above the middle peak with rising volume.

Resistance

Triple Top

Bearish

Three rejections from one level show persistent supply.

Confirmation
Break of the shared support with a decisive close.

Ascending Triangle

Bullish

Flat resistance with higher lows — buyers keep paying up.

Confirmation
Close above the flat upper line, ideally on expanding range.

Descending Triangle

Bearish

Flat support with lower highs — sellers keep pressing.

Confirmation
Close below the flat lower line.

Symmetrical Triangle

Neutral

Lower highs and higher lows squeeze price into a point.

Confirmation
Trade the direction of the breakout close, not the squeeze.

Bull Flag

Bullish

A sharp advance then a shallow drift lower — a pause, not a reversal.

Confirmation
Break of the upper flag line resumes the original move.

Bear Flag

Bearish

A sharp decline then a slow drift higher before the next leg down.

Confirmation
Break of the lower flag line resumes the decline.

Rising Wedge

Bearish

Price grinds higher into a narrowing range — momentum is fading.

Confirmation
Break of the lower boundary usually resolves downward.

Falling Wedge

Bullish

Price drifts lower in a narrowing range as selling pressure dries up.

Confirmation
Break of the upper boundary usually resolves upward.

Rectangle / Range

Neutral

Price rotates between clear support and resistance.

Confirmation
Fade the edges while it holds; trade the break once it closes outside.

Rim

Cup and Handle

Bullish

A rounded base followed by a shallow pullback before a breakout.

Confirmation
Close above the cup's rim after the handle completes.

Rounding Bottom

Bullish

A slow, saucer-shaped base as control passes from sellers to buyers.

Confirmation
Sustained closes above the left-hand high.

Broken level

Breakout and Retest

Neutral

Price clears a level, returns to it, then continues.

Confirmation
The retest must hold — a close back inside invalidates it.