Master 12 Most Powerful Candlestick Patterns Before Trading | Baraq Adnan | Skillshare

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Master 12 Most Powerful Candlestick Patterns Before Trading

teacher avatar Baraq Adnan, Student and Entrepreneur

Watch this class and thousands more

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Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Watch this class and thousands more

Get unlimited access to every class
Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Lessons in This Class

20 Lessons (1h 4m)
    • 1. Course Introduction

      1:42
    • 2. Candle Anatomy and How to Read it

      1:47
    • 3. 1 - Hammer Candlestick Pattern

      1:59
    • 4. How to Identify Hammer Candle and Trade it with Precision

      7:11
    • 5. 2 - Piercing Candlestick Pattern

      1:58
    • 6. How to Identify Piercing and Trade - GBPUSD and Apple Example

      5:18
    • 7. 3 - Dragonfly Doji Candlestick Pattern

      1:45
    • 8. Dragonfly doji GBPUSD Example

      5:05
    • 9. 4 - Bullish Engulfing Candlestick Pattern

      1:15
    • 10. Bullish Engulfing Candlestick - GBPUSD Example and Trade

      4:53
    • 11. 5 - Bullish Harami Candlestick Pattern

      1:25
    • 12. Bullish Harami GBPUSD Example and How to Trade it

      3:44
    • 13. 6 - Bullish Inverted Hammer Candle

      1:15
    • 14. Bullish Inverted hammer GBPUSD Example and Trade Practice

      3:22
    • 15. 7 - Bearish Shooting Star Candle

      0:56
    • 16. Bearish Shooting Star GBPUSD Example and Practice

      6:29
    • 17. 8-Bearish Dark Cloud Candlestick Pattern

      1:56
    • 18. Bearish Dark Cloud Candlestick CHFJPY example and Practice

      5:43
    • 19. 9 - Hanging Man candlestick Pattern

      1:13
    • 20. Bearish Hanging Han GBPUSD Example and Practice

      5:00
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About This Class

In this course we are going to cover:

  1. Candle Anatomy ?
  2. Bullish Reversal Vs Bearish Reversal Pattern?
  3. 12 Types of Candlestick Patterns ?
  4. How to Trade candlestick patterns ?
  5. Identifying High Probability Candle Formations points

The purpose:

The purpose of this course to help you recognise the charting candlestick patterns and high probability points of trade setup. 

Meet Your Teacher

Teacher Profile Image

Baraq Adnan

Student and Entrepreneur

Teacher

A Student, Professional Trader and Entrepreneur.

Expertise in recognizing market structure and identification of price patterns for potential reversal point. An active trader and live forecaster at various recognize trading forums.

Carrying a mission to make it easier for people to have financial freedom by sharing passive income strategies that generate residual income with an entrepreneurial mindset.

Learn Together - Grow Together - Succeed Together

See full profile

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Transcripts

1. Course Introduction: Hello, guys. Thank you for joining in and they scores specifically, We're gonna cover the Candlestick patrons. Yes, I know a lot of people have already knowledge about the kind of sick patrons, but I received so many questions from my students that they are confused how they can utilize the candlestick knowledge because there are a lot of candles name now out in the market, that creates noise. In my humble opinion, there are only 12 patrons that we need to know on a lot of them going to boil down to only two patrons, which you need to know on Lee. OK? And I will cover this during the course. So basically, this course is all about mystic patterns. Which Candlestick pattern is the most powerful on how we can trade these kind of sick patrons. Course we're gonna cover right from the beginning. What is not me off the candle? How a candle is formed or what is a life cycle offic handle on? We're gonna cover the bullish worst organist IQ patrons as well as the bearish reversal. Candace, take patrons. And then we will talk about those 12 Candlestick patrons that I teach my students or I personally use Also, Another reason do launching this course is to share my knowledge what I have found so far knowing about these candlesticks and technically how to trade them. So you know these old things I'm gonna cover in this course and also the high probability points that where these candles have significant, important and in the last, we're looking to the high probable places where these candles have more important or their results stick and drive are tremendous. Okay, so without further to do, let's start this course I want to make this course precise to the point on will go into the chart and have a live examples as well. So let's start this and I'll see you next light. 2. Candle Anatomy and How to Read it: Hello, guys. Welcome back. Now, this is the first slide. We're going to cover a life cycle off a candle. What exactly a candle is or how to interpret this candle on the left hand side. As you can see, there is a fight or a green candle that represent a bullish move. Bullish movement. When the price started, it went up. Or when the session walls ended, the price waas above to the starting point. Similarly, the black and red candle shows a bearish move. When the market was opened, it closed below the opening price. Okay, so the board candles can be on any timeframe. It can be a minute, second vertically, daily candle that represents the whole range or how to read this very quickly. Let's take example of this green candle. Okay, so the green candle have opening price on a low. I mean, that's how far the price went during this one candle trading session. And then there is a high that means that high the price vent on. Then there is a clothes and the clothes means that's where the price was closed during that session. So let's say if that candle is represented by one over so we can easily say in the one over The price went older, it down here all the way up here. And then it closed above to the open point. And that turned the scandal into a green, which means the price moved up. Similarly, if the price open and close below the opening price, that is the Red Candle, which means the market had the negative move. So that's a quickly brush up information. Now let's start our first packer and I will see you next slide. 3. 1 - Hammer Candlestick Pattern: Okay, Welcome back. The first of all, we are going to cover the bullish reversal. Candlestick, Patrick. Bullish reversal mean when the market have a strong downward move, then these patrons appear so bullish. Reversal can also be interpreted as it changed the market direction toward the bullish side . Let's say the market is bearish. Then it candlestick pattern appears on That changes the momentum from bearish to bullish from downward toe upward. Okay, so the very first candle we're going to talk about here is Hammer Candlestick. This is one of my favorite and it has a lot of significance. Andi, you will notice that quite a lot of patrons when we do perform edition on these candlesticks that turn into a hammer Candlestick will explain this concept later on, and we'll see that as well. With example, this is called a hammer candlestick pattern. So it's a single candlestick patron. What we can see is when the market opens, the bears drive the price all the way to down. But then the bulls state control and they pushed the price all the way to the top by creating a small body on top. Okay, this can be a green gandal. That can be a red candle, which means you will always see a long week at the bottom and almost no or very small wake at the top. This is how I explain it or, you know, my findings throughout the years for this particular pattern. Recognition A's. The bottom tail is always twice the size where I would say more than twice the size off the body against, which means the bottom tail will always be bigger than the top tail. Second, the bottom tail will always be twice the size off the body because the longer the wick is, the stronger the momentum could be Okay, and then we will have a small body right on top. Also, this is called Hammer. Now let's dive into the chart and identify this candle on a live chart. 4. How to Identify Hammer Candle and Trade it with Precision: Oh, you guys, Welcome back. Now we're in the chart, and this is a GBP USD daily chart, which means each candle is representing one day off trading. Okay, Andi, you might have noticed that. You know, I gave you the example off a whole a candle as well. So if we change the chart toe a hold a candle chart. As you can see, the green one candle will be hollow, and the red candle will be bearish. Candle. Okay, So the hollow candle is the green cattle, which means the price going up and red means surprise, going down vice versa. Okay, I'm going to switch back to Candlestick chart. Okay, now we just discussed hammer candle. Now, can you identify a hammer gandal on this chart? Quickly. Okay, you can pause this video on how? Look on where you can see a hammer candle. It's very obvious. Let me explain here. The Hamel candle is Yeah. So it fulfill all the criteria that we have. Okay. Which means the market have a strong down more. And then this candle will appear. This candle will have long wick at the bottom. Okay, Here is a long brick at the bottom. It will have a very short wick at the top on a small body. Andi, the bottom wake will always be twice the size off the body ridges. Clearly, in this case. Okay, so this is a perfect example. Off hammer. So what happens once the scandal appear? The market changed from bearish to bullish sign. OK, you will be noticing. There are other hammer candlesticks appearing as well. Okay, let's have a look. Okay, let's have a look. What about this? Is this a hammer candle? Yes, but the week is not as significant or twice the size off the body. Plus it's appearing in a bullish move. If it appears in a bullish move, we ignore it. Okay? It's not Hammer. Let's take another example. Is this hammer? No, the week is not that long. Okay. Give you another example. How about this scandal? Is this hammer? No. How about this one? It's beautifui. Let's check it. Because the bottom vague is approximate. I don't think so. It's twice the size, but let's have a look. Okay, so that's first. You can see the bottom. Rick is not just tries to size off the top body on what we have seen. Yes, the market went up, but it wasn't a strong momentum. The long Rick shows strong momentum. Okay, let me give you another example. Okay. Hubbard, this one. Is this a hammer, Kendall? Yes. OK, because small body, the bottom week, twice the size off the body on it appears after a short. Now, let's talk about how to create it. There are two ways to trade any candlestick pattern. Okay, The first is aggressively, which means as soon as you see the pattern once the patron is finished because this is a daily cattle. So once the second candle is about to start, you place your and treat a few pips above To that candle on your stop loss goals below the Rick off this candle, you go for whatever your risk and reward ratio strategy is 1212 to 13 to one. Okay, so you plays depending buy. Stop. Order. Right on the top, off the candle. Okay. And your stop loss comes underneath the wick. Okay. A few pips underneath the brick. And that's how you traded. Okay, That is the first report. Aggressive approach sometimes what you will notice the price will retrace wants this patronage form. Okay, which is example here. Okay, let me zoom in. Now, here's the key question when this pattern will be valid and when we can say its in Molitor . Okay, so as soon as the price close below the vic off this candle, this pattern is no longer valid. Okay, Now, here's interesting thing. If you notice once this pattern is form, the price came all the way down to the bottom or to the vic off this candle. Okay? But it never closed below. Now you can see the importance off this bit off information that how you can validate this patron. Okay, Price never closed below a So what do you do you place pending order by stop here or you place a pending order on top off the previous red candle. And that way your risk underwater shook gets better, OK? Or you can move down to a lower timeframe on can take your entry right here. That's how you get 10 2030% profit portrayed by going into lawyer timeprint. But as you notice, you must have a certain pattern. Appears on a hard time frame If the signal is on the hard time frame and you traded on small, the gains can be bigger. Okay, But if the signal is on a smaller timeframe, obviously the market moves up and down. Sometimes you do get a decent results, but most of the time it creates fear in the capsule, you know, up and down and traded clothes. Their position considering with the market is that it works. Okay, so this is how you traded, which is a lenient approach. You wait for the market to retrace you take your entry there or you take entry on the top of previous red candle and you get better risk and reward. Okay, so that is a hammer candle on. This is how you created Okay on. We have also identified when to ignore this candle in a bullish move. Onda, when this candle is invalid. Okay, Now let's go back to the second pattern on. We'll continue from there. Ok, now, one thing. I will urge you before we go to the slide, please. You know, identify this candle on any chart high time frame and share it. Okay, So in that way, you will be able to apply your knowledge and to see rather you can identify or not. Obviously I will comment. Okay. I will see you next light. 5. 2 - Piercing Candlestick Pattern: Okay, guys, Welcome back. Now we're going to talk about the second bullish Candlestick pattern and that is called piercing Candlestick. Okay, on the formation is very, very simple. First, we have a bearish momentum and then we see the market opens with a gap down, as you can see in the slide, the price open below the clothes off the previously Kendall and then the closing price wars within the body off the previous day. Candle in simple words, the previously candle will be read. On the next day, candle will open with a gap. Down on it will be a green candle completing within the body off previous day. Now to identify other, it's a week piercing candlestick or a strong piercing candlestick. The green candle has to finish more than 50% off the body off the previous day. Candle. So which means the price has to go all the way up more than the 50% off the red candle and then close it there. That will show a bullish momentum. And you know what? The crazy part here is? Piercing candlestick pattern is basically a hammer. If we combine these two candles, what we will get is a hammer. Let's have a look. Now here you can see we have a red candle on. Then the green cattle opened with a gap down and closed within the body off the previous two candle on it has reached more than 50% off the red candle. Now with the Candlestick edition or Candlestick binding matter, what we can do is to take the open off the previous day, mark it down and then the clothes off the next day mark it down as well. That will both open and closed. Will give us a body and rest off the top and bottom will give us the weeks. Now, this is how we can easily see. Actually, this is a hammer on. We have already seen the significance off Hammer. No, let's get back into the chart and identify a piercing candlestick. Patrick on, We will also look into how to trade it. OK, I will see you in charge 6. How to Identify Piercing and Trade - GBPUSD and Apple Example: Okay, guys, welcome back now. This is exciting part where we are going to identify person cattle on this particular chart . We are in a GBP USD daily chart the pause this video and try to identify the patron which has just taught you a few seconds ago. Can you see the pattern anywhere on this chart? If known, I would like to focus on this area. Now, can you identify Embarrassing candle again going back to the rule. The price will open with a gap down. OK, so do you see any candle that opened with the gap down opening? Look at this candle. Has it finished within the previous candle body? Yes, yes. The price closed within the previous candle. Does the price completed above the 50% off the previous candle? Yes, in this case. Okay. Now let me zoom in ourselves. Look. So the price open with a gap down the previous candle completed hair the next day. Cattle with a gap down. Okay. And the candle finish above the 50% off the previous candle. Now let me draw Fibonacci here. I will take the top off this previous to candle click there and drag it through the bottom off the previous two candle. Okay, There you go. Okay. The top point on the board important on the 50 person is here, right here. Just drawn on. This is the 50 person mark. I'm gonna remove this fib as we can clearly see the green candle closed above the 50% off the previous candle. So does it qualify as a piercing candle? Yes. Okay. And what happened after that? As the market shooted straight up? No, on before the piercing candle appear. Have we seen a bearish momentum? Yes, the price came down. Then we see a piercing candle and then the market consolidated on mental. Okay, so let's add these two candles, okay? And what we learned, we take the opening off previous day, which is hair. And then we take the closing off the next day, which is this one. And this will give us body and the rest here, this is weak on the bottom will become big as well. So let me just expanded. Let me just out of the color as well, cause it's big transparent. There you go. Actually, color will be read. Okay, well, that then green can you see? It's a Bring this to the front. Can you see It's a hammer. Okay, so these boards through candles, hammer how we traded. Basically, let me remove that. Simple. Okay, we takes the low in this case, the lawyers here. Well, mark it down, and then we wait next day, the market close above to the previous day Close. So in this candle, the market closed hair the next day. Market rate slightly above, but closed above. Okay. And that gives us a bullish sign reversal. Okay, We could take a pending by stop, right? Few pips above here. Okay, on the stop loss goes underneath and then we try to hit whatever the target we have under one to war or 321 Ok, so let's have another example. Ok? Do you see this pattern anywhere else? Okay, how about this? Let me zoom it to the market open with a gap down, But has it closed within the 50% off the previous Kendall? No. Does it qualify as a piercing cattle yesterday? Superior Sing God! Oh, but is it a proper one? Can we trade this? No. Unless until the price doesn't breach above the 50% off the previous candle. Witches in this case here, that's the mark already. After next, we see the price closed above 50%. Okay. And that gives us a bullish momentum signal on. We're getting place a pending by stop above their with a stop loss beneath. And why sports? I'll get the rest of the theory. Is that Okay? So But I wanted to show you this example because here the piercing took time to form. Okay, on. You know, you will find these patrons everywhere, You know, either on the indices, forex or stocks, you know, you can find it anywhere. Let's have a look into apple chart Now. Here we are in an apple chart. It's a daily chart. Can you identify a piercing patron here? Okay, I can see quickly here. Piercing Patrick. Okay, how about this one? Gapped down. Move up. OK, As you can see, this pattern is very common, and it appears on all sort of sharp. Okay, so now we know how to identify it, and we also notice how toe create it. Ok, now let's get back into the candlestick and learn the next picture. Also, you there 7. 3 - Dragonfly Doji Candlestick Pattern: Hello, guys. Welcome back. Now, This time we are going to cover Dragon Fly daughter. This is another bullish reversal pattern. Okay, so what? It tells basically the market indices. It tells when the market opened, it came all the way down. Created a long week. A long week. Mean the bears push the market down. And then the bulls took control and pushed the market older way up. Okay. On it will either have a very small body or nobody at all, which means indecision. Bulls wanted to take control and bears wanted to take control. And at the end, off the trading session, there wasn't any significant move. Okay, so the dragon Fly daughter basically tells us that market is indecisive more. It can either go up or down further, as with all Candlestick patrons, Dorji tells us the market in Asean and we weight next day to see how markets react. Okay, so this is how the formations look like the market opens. It pushed the market down, create a long wick, both take control and the price close very near to where it opens. And sometimes it doesn't have body at all. Said the opening price It's also a closing price. Okay, now let's head back to the chart on will try to identify Dragon Fly Dodgy candle. One thing Bear in mind that we would like to see a bearish move before the dragon Dodi appears. Okay if it appears in a bullish move with Lauren. Okay, so the market has to come down first. It shows us a bearish movement and then the dragon daughter appeared on. That's where it gives us a caution sign on. We wait for the next day market movement. OK, so now let's head back to the charge and identify this. 8. Dragonfly doji GBPUSD Example: or you guys. Welcome back. Now let's try to identify Dragon Fly daughter on this chart. This is GBP, USD daily chart. I'm trying to stick to one charge so you would be able to see that How many opportunities we can find if we properly understand the candlestick patrons and, you know, read the form and how we can treat them. Ok, so pause this video and try to identify Dragon Fly Daughter, I want you to focus on this area. This area okay. Can you see your dragon fly Dodger? Okay. How about hit this candle? Let me zoom in to the market. Had a bearish move a dragon fly Dorji appear which are very small body long wick at the bottom on a small weak at the top. Okay, so this is our dragon fly Doherty on what we did, we rated for the market for the next day and the market traded below with a dragon fly. Dodgy. We want market to trade above this candle. Okay, so look what happened next day. The market traded below gave the sentiment aftermarket want to go down. But a day after that, the market closed above to our dragon fly dodgy. That gives us a bullish sign. OK, the way to trade This is simple. You identify the lows off the movement which is here, or you identify the laws off the recent move which could be this low. Okay. And you place a pending by stop right on top Here The candle that closed above the daughter Cannell. Okay, with your stop loss. So this become your risk area. OK, so you know, by stop with stop loss below On the very next day, the market took your trade but came down. And then finally it's reversed and, you know, went into our predicted direction on you know, we hit our 1 to 1 to one or 3 to 1 whatever risk and reward ratio we have. Okay, so the market had a bearish move. Then we have a dragon fly and Georgie, we want market to close above. And that gives us a signal to ah, you know, moved towards. And that gives us signal the market. Want to go up? OK, very, very simple. Ok, so that is a very clean example off Dragon Flight Dodger. Okay, let's do a candlestick Mark. What happened here? I want you to focus here. This area what happened here? From this candle to this candle next to the candlestick. Mathematics and identify what happens between these days. Okay, so we are talking about eight days off trading with this range. Okay, so let's have the mathematics. So we said first we go toe pick the opening off the first candle, which is this one grown line straight. And then we get the closing off our last Kendall, which is again the same price. We just do men if I do that precisely. So they closing off the last is basically here on this space will give us body. Let's I'm gonna create a body here. Okay? So because it was red candle, so we're gonna give it a red color visibility less. Okay, that's gives us a body. Anything above and below becomes Rex. OK, so let's admit we have big start from there. Came older it down. Yeah. There you go. So, what we found move it out in the open space so you can actually view So basically that was dodgy. That was a dragon fly. Torchy. Okay, But we couldn't see it, because the way market was moving there. But with the help of candlestick addition, we can easily figure out that what happened between these four days and then the market traded above this dodgy gives us bullish momentum on, you know, we can follow all the rules off engagement on place, the trade. Okay, so now we have seen what is dragon dodgy look like? Okay. And would help off Candlestick addition. We could also identify Ah, this candle and how to treat this as well. Okay, uh, there was another example I was wearing. Look at this one. Another example off Dragon flight daughter. But is it appearing in a bearish move or in a bullish? More is strong bullish. More so that doesn't qualify as a dragon fly. Dodgy. Okay, so we will ignore this. So we found when to ignore Dragon flight, Georgie, how to identify it and how to trade it. Okay, I hope this is helpful. Now, let's go back and learn another patron 9. 4 - Bullish Engulfing Candlestick Pattern: Okay, guys, Welcome back. I hope you are enjoying The scores are so far. And now we are going to cover engulfing Patrick. This is again a bullish Patrick on. It appears in a bearish move. So we expect there is a bearish move in the market and then the bullish engulfing candle appear so the formation is very simple. So there are two types. 1st 1 is market opens with a gap down, but it engulf or covers the full body off the previous day. Candle on the second diapers Read the market open where the previous day price closed. But it covers the in di body off the previous two candle. Okay, so this pattern is called bullish engulfing patron. Okay, now here is a key question is bullish in golfing is a hammer. Let's find out. Yes. Bullish engulfing is a hammer pattern, as you can see in the slide. If we take the opening offered red candle and closing off the green candle, that will give us a body which I represented on the left hand side. And then the remaining part becomes wreck on. That's a formation off a hammer. So in girlfriend, candle or bullish engulfing patron is actually a hammer. Okay, Now let's head back to the charts and find out this patron and have to trade it quickly, OK? 10. Bullish Engulfing Candlestick - GBPUSD Example and Trade: Hello guys. Welcome back Now we are in a practical exercise. This is again a GBP USD daily charge on, We are going to identify bullish engulfing Patron if you pause this video and try to identify abolition, golfing and the both types in our type one where market open with a gap down and the second where the market open at price. Like you know where the previous state close Waas. And that's where the current bar started. But it and go the full board off the previous two candle If you haven't quickly identified yet, There are very obvious patrons here, so I want you to focus here. We just reduce its capacity. Okay, I'm going to zoom in. Okay. What about this candle? Is this engulfing candle? First market. How bearish Move. Okay, check then the market open with a gap down, and it covers the body off the previous two candle. We're talking about this too, and all three candles it fully in gold. Okay, Very strong. Bullish momentum for what happened next to the market. Came down on move on. Ok, so this is called stop hunt. OK, that's another topic will cover it in a different course. So this is bullish engulfing candle okay with a gap down and covered the body off the previous day. How about this one? Is this not a bullish Kendall as well? I mean the coalition golfing candle. It opens at price where the previous state market was closed. It opened at the same price. But you can go the end our body off the previous two kennel. So in this short example, we have both type of candles. Get one with a capped out on the 2nd 1 is covering. So both are giving us bullish signals on the way to trade is very simple. Once the candle and goes the previous candle body we place buy stop order Right on top of this candle here. Okay, let me just remove this on our stop loss scores underneath the law here. So we want to make sure that our hypothesis is correct. OK, so what happens next? It rather than market going up, it went down first. Okay, so not where we are protected. So we only want to go long. If the market break this levels a few pips above panning by stop previous low becomes our stop loss area on weaken. Easy target whatever risk and reward ratio we have. Okay, So in this example, we have seen both types. There is another example. Market open gap down, but it didn't close or engulf the previous body. So that's in dire move is abolishing girlfriend camel. Okay, so again, same phenomenon by stop above stop loss below on. You know, whatever their skin or more gray show you're going to target with us. Okay, So that's how you identify bullish engulfing candles on the way to trader. Okay, the another piece off information is when we will know this pattern is invalid. Like I mean this candle, we cannot place a by stop up there if it breathe the laws off the previous candle on close below that laws, that means our by stop idea is not good. Okay, So as long as the price hover above the previous low, we are in good position by stop will be valid on. Do you know we can stick to our trading plan. Now, let's create a hammer gamble with help off candle addition. Okay, so I'm gonna remove this. Move this as well. That's is a win. Okay, so let's blend these four candles. Okay, So we are going to do is place in line on the start off this candle. Okay, This one. So we are going to cover from this candle to this cattle get to these four days range we're going to cover, and then we are in line at the closing price off the last candle. Okay, That gives us body. So here is our body. Okay? Because it's a green candle. So we're gonna give it a green color, and the rest off the top and bottom become break. So let's go on mixed with Ace. There you go. So it's a hammer. Okay, so it's a hammer candle. So the market went all the way down, but couldn't close below this hammer low hypothesis still relic, and it turns around and took our crate on. Went into our predicted direction. Okay, so this is how we trade the bullish engulfing pattern. Let's head back to the next patron 11. 5 - Bullish Harami Candlestick Pattern: Okay, guys, Welcome back. I hope you are enjoying these lessons as much as I'm enjoying to produce this for you. Now, This time we are going to cover a bullish Karami pattern. Okay? This is another bullish pattern that appears in a bearish move. So we will expect market forced to have a bearish move. Then a green candle will appear in the middle or within the body off the previous candle, so it doesn't necessarily need to be in the middle off the previous candle. It can be either the bottom at the top, but it will be within the body off the previous candle. So the opening and the closing price will be within the body off the previous day candle and that will closet as a bullish Haram e candle. The sentiment. It shows that the market is willing to go up. Ok, there is a question. Do you think so? If we will add both candles, the result candle will be a hammer candle. Yes, your right. As you can see, if we cross the line from the opening off the previous day on another line from the closing off the next day, that will give us a body and the remaining top and bottom becomes the weeks. Okay, so the bullish Haram e also gives us a bullish hammer candle. Now you can see that the hammer gandal is actually that you need to know. Okay, that shows the momentum off the market. Okay, so now let's head back to the chart and identify bullet Karami. 12. Bullish Harami GBPUSD Example and How to Trade it: Okay, guys, Welcome back. Now we are going to identify Bullish Karami. Candlestick. Okay, again. We are in the GBP USD Charter. It's the daily charge on. What I want you to do is to pause this video. Andi, identify bullish Haram e candle again. I want you to focus in this area. Do you see a candle that opens within the body off previous candle on the clothes as well? So the open and close is within the body off the previous candle. Bullish Karami. Okay. Is this in the middle? Nor it's not okay. One thing you will notice with the practice that if the Haram e appears at the bottom edge or the top edge, the market consolidates. Okay. In this case, it did not appear in the middle off the previous candle. Okay, so the market consolidated here for 45 days and then went up okay. On the way to create is simple. Once the bullish Rami is formed, you want price to trade above to this candle. Okay. On the third day, a candle closed above the bullish Haram me. And that was a signal off a bullish move so you could place a by stop Right, The top off the height. Bullish army. Okay, the height off. Bullish army or here? OK, up to you on the stop loss will be underneath the law and you can go for your targets. OK, One thing you will notice. It signifies the momentum if it appears in the middle of the candle. If you try to do a candlestick blending approach, you will notice Take a line open off the previous close off the new candle. Okay, so that gives you The body was created body here, and obviously the top and bottom Vicks become the lining between. If you notice this is a hammer, but it does not qualify Hammer candle characteristics. Okay, You know, we talk about the vic will be twice the size off the body. Okay, In this case, it's not OK, so it's It's basically week hammer, But as soon as the new candles appear, the market goes up. It shows the bullish momentum is there, we can trigger the trade. Okay. Look what happened. Replace the trade here. The market came all the way down, took our stop losses. And then what's this? We're learning this scandal Since the first patron Hammer. Does it qualify for the hammer? Yes, it does. Okay, so the market showed up. That is a first example. Let me give you another example. I think it was here somewhere. There you go. How about this scandal? Is this bullish? Karami? Yes, because the open and close is within the body of the previous candle. Okay, but notice if we use the blending approach Lying from the open, lying from the clothes. And in between is the body dairy Go for Red Candle. Do you think that qualifies the hammer or is closer to Dragon Fly? Daughter? It does get the market. Had a strong push up debate to create obviously stop loss become the previous low, become the stop loss on whites. Person. Okay, so that's how we trade Bullish A. Rami. We wait for the confirmation. We want market to create above to the bullish Karami. Cattle on. Uh, it's a nice reversal, patron. Now let's go back to the slides on learn. The last bullish pattern on that is inverted hammer. Okay, let's talk about this 13. 6 - Bullish Inverted Hammer Candle: Okay. Welcome back. Now, this is the last. A bullish reversal pattern that we are going to cover on that is called Inverted Hammer Candlestick. Okay, It looks like a hammer, but the inverted side. Okay. And secondly, it appears after a bearish move. So what will happen? The price will open. The bulls will push the market all the way up, and then bears take a control on. They will push the market down on the result. Off this trading session would be a small body and a long week at the top with small wick at the bottom. Okay, the small we get the bottom represent, bulls are in control. Bears couldn't push the market down further. And that long wick at the top represent bulls tried, but the bear push it down. But this signifies one piece off information that the bears are in the market. Okay on. That's a moment of caution. We wait for the second candle, and then we look into the sentiment off the market after inverted hammer. Ideally, we would like the price to trade above the closing off the candle next day. And if that's happened, that is a bullish signal and we go with with our trading room. OK, now let's get back to the charred and identify inverted hammer. 14. Bullish Inverted hammer GBPUSD Example and Trade Practice: Okay, guys, welcome back. Now again, we are in a GBP USD daily chart on. I want you to pause the video and identify at least due to three and watered hammer candles . Very obvious long tails at the top and small body at the bottom. Okay, I want to draw your attention. Here is this inverted hammer. How about this one? Is this a inverted hammer? Long tail twice the size off the body and small body at the bottom. Okay. On again appearing after a bearish mood. How about this one? Is this a murdered hammer? Our days. Okay. What about this one? Inverted hammer Weren't lost this as inverted hammer because disappearing after a polish more. Remember we said the market house to be in a very cycle. How about this one? Is this an murdered hammer? Yes. Correct. OK, so we'll check all these examples. Let's focus on this. Okay, so the market hand a bearish move. Okay, let me just zoom in. And then we saw flows and murdered hammer here. This one. Okay. After he murdered Hammer, we want market to trade above this hammer. What happened? The market came down close below the hammer. So the hammer is invalid. Okay. Next move on to this one and more. Did hammer? Yes. Has price closed above this inverted hammer next day? Yes. Market was training bearish before? Yes. Like a valid set up. How we're going to trade so few pips above this inverted hammer by stop with stop loss below cred. Okay, how about this one? How about this one? That was a valid murdered hammer. But the price did not trade above Next day. Invalid. You can't miss this one. How about this? Is this a murdered hammer? Yes. Price had a bearish move and Wertheimer appear we weren't market grid above Richard dead next day. Okay, a few pips above on. Here's your stop loss. Michael took our order. Reversed were out. Okay, no problem. We're lost there. Howard. This one and where did have a few pips above pending by stop stop loss here, Target, whatever the risk Underwater shall we are doing so it worked. Okay. I hope now you understood how to trade inverted hammer. And when the inverted hammer candle is invalid okay with is our bullish candlestick patterns has completed. OK, so these are the six candlestick patterns we covered with help off candles addition. Now you know that what matters is a hammer candle. As soon as we see the hammer candle or the formation turns into the hammer candle, that gives us a strong confidence that the market is changing. Momentum on we can create, according to the strategies, were discussed earlier. OK, so now let's talk about the bearish reversal. Patrick's okay, I will see you next light. 15. 7 - Bearish Shooting Star Candle: Okay, guys, welcome back. Now we are going to talk about bearish reversal. Candlestick patrons. Okay, so these patterns occurred when market have a strong bullish mood. In simple words, we will expect market to go up with a strong trend. And then, at the end, off the trend, we will expect market to show a sign off weakness. Um, that's very shooting star comes. Okay, So the shooting star can look like inverted hammer, but instead off appearing at the bottom off a bearish move shooting star appear at the top off a bullish move. Principles and characteristics are very similar to the hammer. So we will expect Long wick at the top and small body and the vic size supposed to be twice the size off the body. Okay. And the next day, we will expect market to create below a shooting star candle. Okay, so that's the formation off a shooting star. Let's head back to the chart and identify these candles on a live shot. Okay? Also, you there 16. Bearish Shooting Star GBPUSD Example and Practice: Okay, guys, welcome back. Now, this is again a fun part of this course we are going to identify Shooting star on GpB USD daily chart. Okay, Now, if you pause this video and give your best try to identify shooting star candle on this chart, how about this area? Is this a shooting star? What do you think, Howard? This is this a shooting star? What about this one? Is this a shooting star? Okay. And how about this? Does it qualify as a shooting star? I can see this as well. Shooting star on. How about this? This is a shooting star. Okay, so, you know, don't get confused. Obviously, we're gonna look into all of these examples quickly. Okay? So let's start with one. By definition, we said the market will have a strong push on, okay? And then we will see a sign of weakness. Okay, here is over a shooting star. By definition, it will have a long Rick, which it does have small body, which is true. Okay, on, we will expect market toe trade below the shooting star. What happens? So there's a shooting star close. Okay, on that is high off a shooting star. So whatever. Next day the market went up rather than treating below, a day after down, the market came down, which is, you know, traded below closed below the shooting star on that Give us a confirmation that the market is about to go down, okay? Or it's about to change its sentiment. And this is exactly what we observed here. The market came. Don't after that. Okay, So one example. Okay. How about this one? Strong up. 123455 consecutive days. You know, Price moved up. We saw a shooting star. The week is twice the size off the body, okay? And we saw market traded below after that. So the same principle stop loss goes above on is your entry, and you can go for whatever the risk in the water if you are going. Okay. So there are two approaches to trade shooting star similar to the hammer we explored. Okay, The first approaches. Aggressive approach. As soon as we see a shooting star below shooting star, Few pips below shooting star replace, sell, stop order. Okay. With a stop loss above this week. So that is aggressive approach. So as soon as the market go down, it takes our order, and it will go down. Okay on. Then. There is a conservative approach. Conservative approach is basically you expect marker to retrace. Okay, it's a shooting. Start the market. Retrace back. Do the previous high. Okay on, then a trick. Tons. One search through tens. You take your order. Okay. So if if address bank just give you entry here. Okay? So your risk in the water issue becomes really good, or you can go to the Lord timeframe and absolutely kill it. Okay, so there two ways to trade shooting star one is aggressive approach on. The 2nd 1 is conservative approach. Okay, so that was second example with all few here is Well, how about this one? Okay. That said we don't see what happened after this scandal. Only here strong move up and we have a shooting star. Now again, if you follow the rules in place self stop below. And you know that that become our stop loss. We expect market to trade below. It didn't. Did not, Did not know case move up. So our this candle is invalidated. But the good thing is, we haven't lost the money. Okay. Confirmation is must you must expect market a tree below. Okay, Hubbard this if you pit below stop loss above. If you notice the market traced back. Okay. But it could not closed above the shooting star Vic. Okay, so that is a key point on what happened to Mark Came down. Okay. Here it closed above, brother. It's not shooting start because the vic should be twice the size off the body, but it's, I think, 1.5. Okay, so we'll ignore the help of this one. This is perfect shooting star, but what happened? Market traded above its a shooting star. It's invalid. Okay, But on the third day, the market came down below the shooting star. Here is another piece off information about these three candles. These three candles. What we have learned so far. Don't you think so? It's a shooting star as well. Okay, let's do it. Let's do the candlestick. Mathematics. Okay. So open off the previous candle close off there. New candle that gives us a body on that body will be a read body because the tunnel was right. Okay. And then the top and bottom becomes aerobics. So what do you think? Shooting star? Okay, next the market traded below. So there you go. So you have caught a nice reversal. As I said in the beginning, Off the course shooting star on Hammered. These are the two most important patrons that you will see in the candlestick pattern. Okay, on every other pattern will boil down to only these two patterns. Okay, Now we learn what a shooting star, how to figure out how to create it when the shooting star become invalid and with a blending approach, we can figure out when the market is showing a sign of weakness. Okay, so now let's head back and learn the second bearish reversal pattern. 17. 8-Bearish Dark Cloud Candlestick Pattern: Okay, guys, welcome back. Now we're going to talk about the second Berisha reversal. Catholic patron on that is called Dark Cloud. The formation is very simple. What we will observe first, a strong upward momentum. The market will go up first on. Then we will expect market to gap up open so there will be a gap in the market. Market will open above to the where previous Candlebox close and then the market will close within the body off the previous candle. So as displaying the example, the market opened with a gap up and it traded down and closed within the body off the previous scandal. Another thing that I would like to highlight is what makes the dark cloud a strong signal or a weak signal. If a candle a red candle closes within the body off the green candle and that covers at least a 50 person off the previous candle, then this is consider a strong, bearish reversal signal and sometimes you will see the market will open with the gap up and it closed within the body. But to the upper side, which means that we still need to wait and see what how market reacts to that. Okay, good dark cloud signal or the Berisha reversal signal. EDS. When the market close within the 50% body off the previously green candle. Okay, Another thing I would like to talk about if we add these two candles what we get as a result. OK, so the question is, is dark trout is a shooting star? Yes, it is. If we can mind both candles, the opening off the previous scandal and the clothes off the next candle in this case, that red candle, what will get as and result is a shooting star. We know that shooting star is a strong reversal signal where we expect market to trade below. And then we take a trade. Okay, so now we know the dark cloud is also a shooting star. Let's dive back to the charge. I would try to identify Dark Cloud, Patron. Okay, I'll see you there. 18. Bearish Dark Cloud Candlestick CHFJPY example and Practice : Okay, guys, Welcome back now. Here we are in a Swiss franc yen chart, which is CHF JP wine chart, and we will identify Dark Cloud. Patron. Why? Don't just posits video and have a look at this chart and see if you can identify them quickly. Okay. What about this? What do you think about this candle? Okay, that's quickly. I can think of market open cap up. Okay, how about this one market open gap up close, but then, Okay. So let's have a look into this example first. Okay, So what we mentioned is the market will open with a gap up. Okay, so in this example, not where the previous market was closed. But then the market opened with gap up. Okay, The first condition is Matt. Secondly, we said the red candle has to close within the previous body, which is dead. And we said it's supposed to cover at least the 50% body off the green candle. Let's have look. Okay, so if I expand this further on, we create a Fibonacci retracement off this entire green candle. So from the top onto the low. Okay, So here is our 50% says you can see the market closed well below the 50%. Approximately in 80% off the body, 90% of the body. So over second condition is also mad. So here is an example Off dark cloud. So what we expect market to trade below, which it did okay on the market Did very next day and Dr trigger a bearish sentiment. Okay, so the market went down after that. Get first example. Let's check the second example. There it is. Same thing. The market opened with a gap up. Okay. Closed within the previous green candle uncovered at least a 50% off the body. Just check the body. There you go. Exactly at the 50% Rico. Okay. And we expect market to trade below next day. Which it did this red candle on that trigger. A bearish sentiment. The market went Don't after that. Okay, So how to trade this? As you noticed, You know, if it covers more than 50% the market, She was a very aggressive sign off going down. What people do. Basically they can place once the market Craig below where the regular was close to. Okay, so the next day traded below where the Greek cattle wall started, the place line and that for the place sell stop order. Okay, Sell, Stop. Order. With the stop loss above the previous high, mostly the market trace back where the green cattle will started. Okay, so in this case, the next day, market took the order on went down. Okay, let's check the previous example that Terry was workable. Same thing where the green candle walls started. Place line there, bending cells. Stop. I would stop loss above the swing high. Okay. Market next to came up, Took the order, went down OK, after a few days, came back all the way up, but I couldn't go above the the previous high, so your creed was pretty much safe on. That must have given you a decent return. Okay, so now we know how the dark cloud patrons look like on. Do you know how to create it? Don't worry about these patrons. Okay? These Aaron melting patterns we will look into later on. Okay, Especially this one. And there is another one. This one. Okay, so we're looking to later on. So let's focus on what I'm teaching at the moment. So we figure out how these candles pattern will look like dark clouds. Lex, apply a candle adding method to this. OK, so you just removed it. Open off the green cattle close off. Red candle. Okay, so that will give us a green body. Let me just increase their capacity here. That's evergreen body. Okay? And then from the height offs this to the law off this this Kendall. OK, so there you go. That's our shooting star. Okay, so now we know the dark cloud is actually a shooting star. Kind of sick pattern on. We know also how to trade this. OK, so these are the perfect dark cloud Candlestick Patron example. Now, let's have a look into another example where the red candle did not cover more than 50% off the green candles. Okay, so okay. Hubbard death. Okay, so in this example here, Mark Gap up did not cover the 50% off the green candle. Okay, we wait again. Here. Market opened. Gapped up did not cover the 50% off the previous cannibal bait for the next day. So the next day, the market has pretty much cover the entire candles, so that's how waiting for a signal to appear as a strong signal helps us to do not enter in the market aggressively. On most of the time, it helped to protect your equity as well. I guess in in both examples, we waited on Get a give us a strong signal because that turns into a different kind of sick patron. Check this again. These are the shooting stars. If you combine these three candles, he will see shooting store. Same goes here as well. Okay. I thought that I share with you these examples as well. I'll let you practice this and please do share what you find and less more one to the next Petron. 19. 9 - Hanging Man candlestick Pattern: Okay, guys, welcome back. Now let's talk about the next bearish Candlestick reversal pattern on that is called hanging Man. The far vision off this candlestick pattern is very simple. What we will observe first, a strong bullish move on. Then at the end off the bullish move, we will expect market to retrace back by creating a long tail. But the price won't be able to go further up. So what? We will see a small body at the top, but a long wick at the bottom. Ideally, we would like to see this week to retrace at least more than 50% off the previous body. But if the tail retraced the full body off the previous candle, that is a good hanging man Candlestick Patron. So again, what? We will expect market toe trade below the hanging man on that will trigger a bearish sentiment off the market. Okay, so in simple words, the beer will try to push the market down, but the bulls will put it up, but they won't be able to make a significant high. This body will be smaller and long tail at the bottom. Now let's dive back to the chart and find out the hanging man candlestick pattern and how to create this. Okay, I'll see you shortly 20. Bearish Hanging Han GBPUSD Example and Practice: Okay, guys, welcome back now. Here we are in the GBP USD chart, and that's a weekly chart. Unless identify the hanging man Candlestick Patron. Okay, so what I want you is to pause this video on quickly. See how many candles or a hanging man candle you can find all this, child. Ok, OK, how about this one? Is this a hanging man? Cattle about this one? Okay. Small body, long week and next to the green candle. Okay, How about this one? Small body, Long wick after bullish move. Okay, how about this one? Getting all these candles are hanging, man candles. Yes. Okay, let's reel them one by one. Okay. Check this example. Okay. It's a market has a move up. Okay. And then there is a candle with a small body Long wick on. As you can see, this week has craze pretty much their entire green candle. Daddy is an example off hanging man cattle. Okay, let's take another one. This one again. Bullish move. Small body, Long wick. Okay. On the market. Hard retraced at the bearish ball. Okay, so basically, whenever this scandal will appear, we will wait for market to trade below the hanging man cattle in this case here and then after it gives us a sort of confirmation, the market can go down. Okay. How much it can go down that starts a separate story. OK, but not triggers bearish sentiment. Look it here. Same thing. Okay. Moved up a little bit retracement up and then created a hanging man candle Next candle traded below on. Then food is after the market. Retrace up. If you notice the market could not close above the high off hanging man Cattle patron. Okay, I went there and then boom down. Okay, How about this one? This gonna love here. This is also another example off hanging man candle. Now, this is typical example where the market created below on user placed stop loss above the market reversed, took the stop loss and then, you know, went down. So sometimes you will observe this, but that's again as a trader, you have to quickly decide. You know what will be my next book, brother? That was a stop on. Or that was a proper reversal as long as the market does not close above. You know, our sentiment remained bearish and that's what exactly happened. So in case if the market takes to stop out Okay, the banning cell stop can go there. Yeah, with stop loss above. So if the market continuously move up, were safe. But if we are expecting market can go down, it will take us along on do you know will have a recovery and on the profit as well. Okay, so how you trade it, basically, as soon as you see the hanging man candle, then wait for the market to create below next day, then below this, you can place a pending cell stop. Place your stop close above there. If the market goes on, it will take your order. If it move up and you know does not even retrace your order is still safe. Okay, So the rate of traders to place pending self stop below If the market is still up again, if the market has moved down, you can place your celebrate hair and the market can reaches up and take your order and can go down on that. That's what happened here. Okay, There you go. So this is how you trade it? I would like to draw your attention to another example. How would this one this move here. What do you think about this? Okay, let me just Do you see a hanging man Cattle there? Yes, If you take these three candles face, this is your first green. This is your second cattle and third cattle If we combine the second and third Okay, what do we get? So let's do mathematics hair. So you place open a Fred count close off green cattle, and that gives us a red body. It's place red body here. Okay. And then from top to bottom, we get awake. OK, so what is this? This is a hanging man. So this is a green candle and then small body long Rick Hanging man, cattle created below and their ego. Okay, this is how you can identify on you can create. Now let's head back and learn further the bearish kind of sick reversal pattern. Okay, I will see you there.