5 Candlestick Patterns Every Beginner Should Recognize

Once you understand a single candlestick, the next step is recognizing common patterns formed by one or a few candles together — here are five of the most widely referenced.

1. Doji

A doji has a very small or nonexistent body, with the open and close prices nearly equal. It signals indecision between buyers and sellers, and often appears near potential turning points, especially after a strong trend.

2. Hammer

A hammer has a small body near the top of its range with a long lower wick, appearing after a downtrend. It suggests sellers pushed price down during the period, but buyers stepped in strongly and pushed it back up — a potential bullish reversal signal.

3. Shooting star

The mirror image of a hammer: a small body near the bottom of its range with a long upper wick, appearing after an uptrend. It suggests buyers pushed price up but were overwhelmed by sellers — a potential bearish reversal signal.

4. Bullish engulfing

A two-candle pattern where a small bearish candle is followed by a larger bullish candle that completely “engulfs” the body of the first. It suggests a strong shift from selling to buying pressure.

5. Bearish engulfing

The opposite of bullish engulfing: a small bullish candle followed by a larger bearish candle that engulfs it, suggesting a strong shift from buying to selling pressure.

Key takeaway

Candlestick patterns are most useful as context, not standalone signals — they carry more weight when they appear at a meaningful support/resistance level or align with other analysis.