Hereās a quick guide to understanding market psychology using candlestick formations. Candlestick patterns help traders anticipate price direction by reflecting past price behavior and crowd sentiment. They are grouped into single, double, or multi-candle formations each offering clues for bullish, bearish, or neutral outcome
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⢠Bullish: Hammer, Inverted Hammer, Dragonfly Doji
⢠Bearish: Shooting Star, Hanging Man, Gravestone Doji
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⢠Bullish Reversals: Bullish Engulfing, Piercing Line, Tweezer Bottom
⢠Bearish Reversals: Bearish Engulfing, Dark Cloud Cover, Tweezer Top
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⢠Bullish: Morning Star, Three White Soldiers, Three Inside Up
⢠Bearish: Evening Star, Three Black Crows, Three Inside Down
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Doji, Spinning Top, Marubozu these often signal market indecision or a potential reversal depending on the context.
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The candle body reveals open/close prices, wicks show highs/lows. Green candles signal bullishness, red indicates bearishness.
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Always pair candlestick patterns with volume analysis and trend direction for higher trade accuracy.
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