Rising Three Methods Pattern

Last Updated: December 19, 2016

There's just something about the number three: the Three Bears, the rule of three, the Three Billy Goats Gruff, the Three Stooges, the magic number on Schoolhouse Rock, the number of times one must say Beetlejuice . . . Don't believe me? Read that first bit twice more. After all, the third time's the charm! If you find threes to be particularly lucky, you will certainly be interested in learning about the Rising Three Methods pattern, a bullish continuation signal that includes three short candles and two long ones. To learn more about this pattern's formation and meaning, please scroll down in one . . . two . . . three!
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Harami Cross Candlestick Pattern

Last Updated: November 28, 2016

You know what a doji looks like, right? And I bet you're familiar with the Harami, another essential signal, as well. If you know those two basic signals, spotting and understanding a Harami Cross candlestick pattern should be a cinch. This signal resembles the classic Harami, except the very small second candle of the Harami is replaced by a simple doji that resembles a cross sign. Depending on the price movement and the current trend, the Harami Cross can be bullish or bearish. However, no matter what its color and no matter what its trend, do not risk ignoring this pivotal pattern.
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Bearish Belt Hold Candlestick Pattern

Last Updated: November 10, 2016

It was a bit unfair of us (a "hit below the belt," you might say) to introduce you to the Bullish Belt Hold candlestick pattern without giving its brother, the Bearish Belt Hold candlestick pattern, an equal amount of time in the spotlight. It was mentioned offhand, in a two-sentence paragraph, but that's hardly enough time to fully explain the appearance and implications of this bearish signal.

Formed at the end of an uptrend and signaling a potential reverse in investor sentiment, the Bearish Belt Hold pattern is easy to spot, but it isn't foolproof. Ready to learn more about its characteristics and meaning? Let's get started . . .
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Doji Candlestick Pattern

Last Updated: October 20, 2016

Although we've discussed Dragonfly and Gravestone doji in the past, we never got around to explaining the simplest of all candlestick patterns: the basic doji, sometimes referred to as a "Doji Star." Resembling a plus sign or a cross, the doji candlestick pattern is formed of just one candlestick, and it is incredibly common. Although there are several different types of doji (such as the Gravestone, the Dragonfly, and the Long-Legged), which we will describe briefly, today we're focusing on the classic, original doji. To learn how to identify this informative candlestick pattern and interpret its presence, simply scroll down.
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Bullish Piercing Pattern

Last Updated: September 29, 2016

The word piercing has several varied definitions, but most of them revolve around the same idea: "go into or through something," "force or cut a way through," "seeming to cut through one," "bore a hole or tunnel through," etc. The Bullish Piercing candlestick pattern is likely named piercing because of the way the white candle's close cuts through the midpoint of the previous day's black candle. This two-candle, bullish signal is easy to spot and confirm, so take advantage of it! Scroll down to learn how to identify, interpret, and react to the Bullish Piercing pattern.

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Bearish Engulfing Pattern

Last Updated: September 21, 2016

Imagine a mountain engulfed in flames. What a sight that would be! When I picture a Bearish Engulfing pattern, I think of that imaginary mountain. There are prices rising upward, creating one half of the mountain, a black candlestick engulfing a white candlestick at the top, and then the inevitable downward movement creating the other half of the mountain. This bearish candlestick pattern is important for investors to know, and luckily it's easy to identify and interpret. We've already discussed its bullish brother, the Bullish Engulfing pattern, so today it's time we gave the Bear its turn.
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Bullish Tri-Star Candlestick Pattern

Just last week we discussed the Three Stars in the South candlestick pattern, a rare bullish reversal signal composed of three candles, each slightly smaller than the one preceding it. Funnily enough, another pattern contains "three stars" and forecasts a takeover by the bulls. The Bullish Tri-Star candlestick pattern, as you might have guessed, also contains three candles. It shares the rarity of the Three Stars in the South pattern, but its candles actually look somewhat like stars because they are doji (and thus, don't typically have real bodies). To learn more about this elusive signal, please scroll down.
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Three Stars in the South Candlestick Pattern

What do you think of when you hear the phrase "three stars in the South?" The Lone Star State (i.e., Texas)? Your favorite celebrities with Southern roots? The actual "Star of the South," an enormous diamond found in Brazil in 1853? Probably not. If you're a trader, you may not have considered any of these possibilities. Instead, your mind might have raced straight to the Three Stars in the South candlestick pattern, an extremely rare bullish reversal signal.
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Bearish Kicker Candlestick Pattern

Last Updated: August 9, 2016

A huge news story can act as a "kick in the butt" for investors. Whether the event involves a change in company management, hype surrounding the announcement of a new product or service, or a worldwide news story, the resulting change in investor sentiment can cause prices to fly up or jump down. In some of these instances, a Bearish Kicker candlestick pattern will occur. This two-candle signal announces that investors have changed their minds about a stock, causing it to gap down and then continue falling in price. It is a very influential and powerful signal, so you would do well to heed its warning! But first, you will need to learn how to identify it, understand it, and interpret its formation . . .
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Three Outside Down Candlestick Pattern

Any trader worth his or her salt knows that, when relying on a forecast provided by Japanese candlesticks, it is always best to wait for confirmation. By watching what happens right after a signal pops up, you can verify the reliability of the pattern. Thus, if you can afford to hold your horses for another trading period, you can increase your confidence and peace of mind before making your trade. Some signals, like the Three Outside Down candlestick pattern, are built upon the concept of confirmation. After all, when it comes down to it, the Three Outside Down is just a confirmed Bearish Engulfing signal.
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