Candle stick analysis is done for analyzing a a market of short time span. there are different types of patterns which can be used to easily predict the market movement, such as engulfign, piercing, doji, hammer, hangman morning star and evening star.
- : It is the technical analysis done with the help of candle stick charts. The color of the candle represents the market behaviour, whether it is bullish or bearish The height represents the difference between the opening and closing price The upper tail represents the highest price, and the lower tail the lowest price Volume is also considered while making a decision In real time it is used to predict the markets future behavior and take decision accordingly
- : Max 1 month Min 1 week
- : Candle stick analysis is used in order to know the market behavior for a short time span, which cannot be known clearly using line chart Volume shows the level of trade that has happened for that particular candle which can be used to validate the data inferred from the candle
- : The pattern where a the price starts from a little below the previous closing price and rises above the previous opening price and also the opposite of it is known as the engulfing The volume should be high When the engulfing pattern appears and the volume is high, shares must be bought , when the reverse engulfing happens , sell the shares
- : The pattern where a the price starts from a lot below the previous closing price and rises above half the previous candle and also the opposite of it are known as piercing The volume should be high When the piersing pattern appears and the volume is high, shares must be bought , when the reverse piercing happens , sell the shares
- : Doji is a candle where the opening and closing prices are nearly same and the trade volume is high If the trade volume is high and the market tends to move upwards after that, then a long position can be declared, or else short position
- : A morning star is a pattern made up of a tall black candlestick, a smaller black or white candlestick with a short body and long wicks, and a third tall white candlestick. It follows a downward moving market indicating an upward movement An evening star is a bearish candlestick pattern consisting of three candles: a large white candlestick, a small-bodied candle, and a black candle. It appears following a upward moving market indicating a downward movement When morning star appears buy, when evening star appears sell.
- : Hammer is a pattern where the less difference between the opening and closing price but a huge difference between the highest and lowest price ad also the closing price is nearly same as the highest price, which makes the candle look like a hammer. A hammer should be green in colour The trade volume should be high When a hammer appears shares should be bought A hangman is the opposite of hammer, when this appears, shares must be sold