While not strictly a candlestick pattern, continuation triangles (ascending, descending, symmetrical) are multi-candle patterns where price contracts between converging trendlines. Breakouts from triangles tend to continue the prior trend. Triangles are measured-move patterns — the target equals the height of the triangle projected from the breakout point.
Ascending triangle: flat top resistance with rising support, Descending triangle: flat bottom support with falling resistance, Symmetrical triangle: converging trendlines with equal slope, Volume typically decreases during formation and spikes on breakout
Breakout from the triangle on above-average volume, Retest of the broken trendline as new support/resistance, Divergence resolution on oscillators at breakout, Prior trend context (continuation bias)
Target = height of the triangle base projected from breakout point, Stop just inside the triangle on the opposite side, Time-based invalidation: if no breakout by ~75% through the triangle, the pattern weakens
1H, 4H, Daily
Triangles that form in the direction of the prior trend have a higher probability of breaking out in the trend direction. Volume contraction during formation is key — if volume stays high, the pattern may not be a triangle.
Doji and spinning top candles signal indecision between buyers and sellers. A doji has nearly identical open and close prices, while a spinning top has a small body with long wicks on both sides. These patterns are most significant at the end of extended trends where they can foreshadow reversals.
The abandoned baby is a rare three-candle reversal pattern considered one of the most reliable candlestick signals. It forms when a doji gaps away from the preceding candle and the following candle gaps in the opposite direction, leaving the doji isolated with gaps on both sides. The pattern indicates a dramatic shift in market sentiment where momentum completely reverses between sessions.
A bullish engulfing pattern occurs when a large green candle completely engulfs the prior red candle near the bottom of a trend. A bearish engulfing is the opposite — a large red candle swallows the prior green candle at the top. Engulfing patterns are among the most reliable two-candle reversal signals.
The kicker pattern is one of the most powerful two-candle reversal signals in candlestick analysis. It forms when the second candle opens at or beyond the open of the prior candle and moves aggressively in the opposite direction, effectively 'kicking' away from the previous sentiment. Kickers often occur after overnight news events or fundamental catalysts that cause an abrupt sentiment shift.