In this video, you will look at some common candlestick patterns, which you can use in your forex trading. Compared to a line chart, the candlestick chart contains more useful information. Each candlestick represents the open, close, high, and the low price based on the timeframe of the chart. Candlestick charts show trends more clearly. These are some of the common patterns listed below.
Spinning Top:
This pattern consists of a very small body and long wicks on either side and the wicks are of equal size. This pattern represents reversal in trend.
Doji:
This is similar to a spinning top, but there is no real body, and has long wicks on both sides. This candlestick represents indecision in the market and indicates a trend reversal is likely.
Marubozu:
This candlestick pattern represents continuation of the trend. It consists of a single candlestick with a large body, but no wicks.
Use these patterns in your trading strategy. Use additional technical indicators for confirmation.