Best 5 Bullish Reversal Candlestick Patterns ever - Every Traders should know.

 Best 5 Bullish Reversal Candlestick Patterns ever - Every Traders should know.

What is Bullish Reversal Candlestick patterns?

Bullish reversal candlestick patterns signify that buyers are momentarily in control. However, this doesn’t mean that you should buy immediately when you spot such a pattern because you must take the market conditions into consideration.

The 5 best bullish reversal candlestick patterns are

These are five bullish reversal candlestick patterns we’ll be discussing: 

• Hammer. 
• Bullish engulfing pattern. 
• Piercing pattern. 
• Tweezer bottom. 
• Morning star. 

Now, there are many more bullish reversal candlestick patterns out there. But you don’t need to know them all since the key focus here is just to Note: For a bullish candle, the open is always below the close. And for a bearish candle, the open is always above the close.

Hammer Candle

A hammer is a (one-candle) bullish reversal pattern that forms after a decline in price. 

Here’s how to recognize it: 

• Little or no upper shadow. 
• The price closes at the top ¼ of the range. 
• goog_192447218The lower shadow is about two or three times the length of the body. 

And this is what a hammer means: 

1. When the market opened, the sellers took control and pushed the price lower. 
2. At the selling climax, huge buying pressure stepped in which pushed the price higher.
3. goog_192447220The buying pressure was so strong that it closed above the opening price. 

In short a hammer is a bullish reversal candlestick pattern that shows rejection of lower prices.

Bullish Engulfing Pattern

A bullish engulfing pattern is a (two-candle) bullish reversal pattern that forms after a decline in price.

Here’s how to recognize it: 

• The first candle has a bearish close. 
• The body of the second candle completely “covers” the body of the first candle (without taking into consideration the shadow). 
• goog_192447222The second candle closes bullish. 

And this is what a bullish engulfing pattern means: 

1. On the first candle, the sellers are in control because they closed lower for the period. 
2. On the second candle, strong buying pressure stepped in and the close was above the previous candle’s high, which tells you that buyers have won the battle for now. 

In short a bullish engulfing pattern tells you that the buyers have overwhelmed the sellers and they’re now in control.

Piercing Pattern

A piercing pattern is a (two-candle) reversal pattern that forms after a decline in price. Unlike the bullish engulfing pattern which closes above the previous open, the piercing pattern closes within the body of the previous candle. Thus, in terms of strength, the piercing pattern isn’t as strong as the bullish engulfing pattern. 

Here’s how to recognize it: 

• The first candle has a bearish close. 
• The body of the second candle closes beyond the halfway mark of the first candle. 
• The second candle closes bullish. 

And this is what a piercing pattern means: 

1. On the first candle, the sellers are in control because they closed lower for the period.
2. On the second candle, buying pressure has stepped in. and the close was bullish (more than 50% of the previous body), which tells you there is buying pressure present.

Tweezer Bottom

When I say tweezer, I don’t mean the tool you use to pick your nose hairs (although it sure looks like one). Instead, a tweezer bottom is a (two-candle) reversal pattern that occurs after a decline in price. 

Here’s how to recognize it: 

• The first candle shows rejection of lower prices. 
• The second candle re-tests the low of the previous candle and closes higher. 

This is what a tweezer bottom means: 

1. On the first candle, the sellers pushed the price lower and were met with some buying pressure. 
2. On the second candle, the sellers again tried to push the price lower but failed and were finally overwhelmed by strong buying pressure. 

In short a tweezer bottom tells you the market has difficulty trading lower (after two attempts) and the price is likely to head higher.

Morning Star

A morning star is a (three-candle) bullish reversal pattern that forms after a decline in price. 

Here’s how to recognize it: 

• The first candle has a bearish close. 
• The second candle has a small range. 
• The third candle closes aggressively higher (at more than 50% of the first candle). 

And this is what a morning star means: 

1. On the first candle, the sellers are in control since the price closes lower.
2. On the second candle, there is indecision in the markets because both selling and buying  pressure are in equilibrium (that’s why the range of the candle is small). 
3. On the third candle, the buyers have won the battle and the price closes higher. 

In short, a morning star tells you that the sellers are exhausted and the buyers are momentarily in control.