Bullish Single Candle Patterns (Chart Guys) Flashcards
What Are the Two arrows
on what charts dows this occur
How is this set up played
Price Targets for the formation
- Hammer, 2. Bullish Confirmation
All: one-minute charts, daily charts, and weekly charts.
During the confirmation candle is when traders typically step in to buy. A stop loss is placed below the low of the hammer, or even potentially just below the hammer’s real body if the price is moving aggressively higher during the confirmation candle.
Hammers DONT provide a price target, so figuring what the reward potential for a hammer trade is can be difficult. Exits need to be based on other types of candlesticks patterns or analysis.
What Is The Name
what does it tell you
Inverted Hammer:
a long upper shadow, which should be at least twice the length of the real body.
it is a warning of potential price change, not a signal, in and of itself, to buy.
It is important to repeat, that the Inverted Hammer formation is not the signal to go long; other indicators such as a trendline break or confirmation candle should be used to generate potential buy signal.
The bearish version of the Inverted Hammer is the Shooting Star formation
Name
Significance
what time frames
how to trade
Bullish Belt
The bullish belt hold, known as “yorikiri” in Japanese, often signals a shift in investor sentiment from bearish to bullish. This candlestick pattern occurs frequently and shows mixed results in predicting a security’s future price. The potency of the candlestick is enhanced if it forms near a support level, such a trend line, a moving average, or at market pivot points.
The bullish belt hold can be found across all time-frames but is more reliable on the daily and weekly charts as more traders are involved in its formation.
traders should not trade the bullish belt hold in isolation. Using other technical indicators and price patterns greatly increase the probability of a valid signal. For example, the bullish belt hold may open below a previous swing low and close back above that point to form a potential double bottom. The bullish belt hold should be a long white (or green) candlestick to indicate that the bulls have taken back control. Ideally, the candle preceding the pattern should be accompanied by above-average volume to indicate climatic selling and a possible reversal to the upside.
On occasions, the bullish belt hold can be a mere pause in the overall downtrend, therefore, it is prudent that traders wait for price to confirm the pattern. An entry should only be taken when price trades above the high of the belt hold candlestick. Conservative traders may want to wait for a close above the high of the pattern. If the bullish belt hold candlestick is long, traders could place a stop-loss order at its midpoint. Alternatively, traders could set a stop below the pattern. Although this requires a wider stop, there is less chance of market noise interfering with the trade.
