Candlestick Patterns [NAS Algo]

Dec 20, 2023

Candlestick Patterns [NAS Algo] plots most commonly used chart patterns to help and understand the market structure.

Bullish Reversal Patterns:
Hammer:

Appearance: Small body near the high, long lower shadow.
Interpretation: Indicates potential bullish reversal after a downtrend.

Inverted Hammer:
Appearance: Small body near the low, long upper shadow.
Interpretation: Signals potential bullish reversal, especially when the preceding trend is bearish.
Three White Soldiers:

Appearance: Three consecutive long bullish candles with higher closes.
Interpretation: Suggests a strong reversal of a downtrend.

Bullish Harami:
Appearance: Small candle (body) within the range of the previous large bearish candle.
Interpretation: Implies potential bullish reversal.

Bearish Reversal Patterns:

Hanging Man:
Appearance: Small body near the high, long lower shadow.
Interpretation: Suggests potential bearish reversal after an uptrend.

Shooting Star:
Appearance: Small body near the low, long upper shadow.
Interpretation: Indicates potential bearish reversal, especially after an uptrend.

Three Black Crows:
Appearance: Three consecutive long bearish candles with lower closes.
Interpretation: Signals a strong reversal of an uptrend.

Bearish Harami:
Appearance: Small candle (body) within the range of the previous large bullish candle.
Interpretation: Implies potential bearish reversal.

Dark Cloud Cover:
Appearance: Bearish reversal pattern where a bullish candle is followed by a bearish candle that opens above the high of the previous candle and closes below its midpoint.
Continuation Patterns:

Rising Three Methods:
Appearance: Consists of a long bullish candle followed by three small bearish candles and another bullish candle.
Interpretation: Indicates the continuation of an uptrend.

Falling Three Methods:
Appearance: Consists of a long bearish candle followed by three small bullish candles and another bearish candle.
Interpretation: Suggests the continuation of a downtrend.

Gravestone Doji:
Appearance: Doji candle with a long upper shadow, little or no lower shadow, and an opening/closing price near the low.
Interpretation: Signals potential reversal, particularly in an uptrend.

Long-Legged Doji:
Appearance: Doji with long upper and lower shadows and a small real body.
Interpretation: Indicates indecision in the market and potential reversal.

Dragonfly Doji:
Appearance: Doji with a long lower shadow and little or no upper shadow.
Interpretation: Suggests potential reversal, especially in a downtrend.