1.

Hammer and Hanging man

The hammer and hanging man can be recognized by three criteria:

1. The real body is at the upper end of the trading range. The color of the real body is not important.
2. A long lower shadow should be twice the height of the real body.
3. It should have no, or a very short, upper shadow.

2. Engulfing Pattern

There are three criteria for an engulfing pattern:

1. The market has to be in a clearly definable uptrend or downtrend, even if the trend is short term.
2. Two candlesticks comprise the engulfing pattern. The second real body must engulf the prior real
body (it need not engulf the shadows).
3. The second real body of the engulfing pattern should be the opposite color of the first real body.
(The exception to this rule is if the first real body of the engulfing pattern is so small it is almost a doji
(or is a doji). Thus, after an extended downtrend, a tiny white real body engulfed by a very large white
real body could be a bottom reversal. In an uptrend, a minute black real body enveloped by a very
large black real body could be a bearish reversal pattern).
3. Dark - Cloud Cover

The following is a list of some factors that intensify the importance of

dark-cloud covers:
1. The greater the degree of penetration of the black real body's close into the prior white real body,
the greater the chance for a top. If the black real body covers the prior day's entire white body, a
bearish engulfing pattern would occur. The dark-cloud cover's black real body only gets partially
into the white body. Think of the dark-cloud cover as a partial solar eclipse blocking out part of the
sun (that is, covers only part of the prior white body). The bearish engulfing pattern can be viewed
as a total solar eclipse blocking out the entire sun(that is, covers the entire white body). A bearish
engulfing pattern, consequently, is a more meaningful top reversal. If a long, white real body closes
above the highs of the dark-cloud cover, or the bearish engulfing pattern, it could presage another
rally.
2. During a prolonged uptrend, if there is a strong white day which opens on its low (that is, a
shaven bottom) and closes on its high (that is, a shaven head) and the next day reveals a long
black real body day, opening on its high and closing on its low, then a shaven head and shaven
bottom black day have occurred.
3. If the second body (that is, the black body) of the dark-cloud cover opens above a major
resistance level and then fails, it would prove the bulls were unable to take control of the market.
4. If, on the opening of the second day there is very heavy volume, a buying blow off could have
occurred. For example, heavy volume at a new opening high could mean that many new buyers
have decided to jump aboard ship. Then the market sells offs. It probably won't be too long before
this multitude of new longs (and old longs who have ridden the uptrend) realize that the ship they
jumped onto is the Titanic. For futures traders, very high opening interest can be another
warning.

4. Piercing pattern

It is composed of two candlesticks in a falling market. The first candlestick is a black real
body day and the second is a long, white real body day. This white day opens sharply lower, under
the low of the prior black day. Then prices push higher, creating a relatively long, white real body
that closes above the mid-point of the prior day's black real body.
5. Morning Star

It is comprised of tall, black real body followed by a small real body which gaps lower (these two
lines comprise a basic star pattern). The third day is a white real body that moves well within the
first period's black real body.

6. Evening Star

Three lines compose the evening star. The first two lines are a long, white real body followed by a
star. The star is the first hint of a top. The third line corroborates a top and completes the three-
line pattern of the evening star. The third line is a black real body that moves sharply into the first
periods white real body.

7. Morning Doji Star and Evening Doji Star

 In a downtrend, if there is a black real body, followed by a doji star, confirmation of a bottom
reversal would occur if the next session was a strong, white candlestick which closed well into the
black real body. That three candlestick pattern is called a morning doji star. When a doji gaps
above a real body in a rising market, or gaps under a real body in a falling market, that doji is
called a doji star. shows doji stars. Doji stars are a potent warning that the prior trend is apt to
change. The session after the doji should confirm the trend reversal. Accordingly, a doji star in an
uptrend followed by a long, black real body that closed well into the white real body would confirm
a top reversal. Such a pattern is called an evening doji star.

8. Shooting Star

The shooting star has a small real body at the lower end of its range with a long upper shadow. As
with all stars, the color of the real body is not important.

9. Inverted Hammer

An inverted hammer looks like a shooting star line with its long upper shadow and small real body
at the lower end of the range. But, while the shooting star is a top reversal line, the inverted
 hammer is a bottom reversal line. As with a regular hammer, the inverted hammer is a bullish
pattern after a downtrend.

10. Harami

11. Harami Cross

12. Tweezers Tops and Bottoms

Tweezers are two or more candlestick lines with matching highs or lows. Matching Highs are
Tweezers Tops and Matching Highs are Tweezers Bottoms. It is combined with any candlesticks
patterns.