Reversal pattern (indicating that the previous trend may change, don’t think that you will turn around immediately and go in the opposite direction, just like braking, maybe resting, maybe stopping now, or turning around)
There is an important principle here: Only when the direction indicated by the reversal signal is consistent with the main trend direction of the market, we can open a new position based on this reversal signal.
Hammer line: It is an important bottom reversal line, consistent with the current status of the hanging line, with a small entity (either white or black), and the entity is at the top of the price range of the day, and has an extremely long down Hatching. A short film, or not.
A downturn is a bullish reversal pattern that usually appears at the tail end of a market decline.
When the price goes down, the downside indicates that the bottom is near and the price will start to rise. The long lower shadow shows that sellers are pushing prices lower, but buyers are able to overcome this selling pressure.
Just because you see the formation of a head down in a downtrend does not mean that you should place a buy order immediately. Before you set a buy order, you need more signals to confirm the arrival of the bull market.
An example that can confirm the arrival of the reversal pattern is: wait until the second candlestick closes at the opening price of the downside.
✿ Long shadow is two or three times the entity;
✿ Little or no hatching;
✿ The upper limit of the physical part in the transaction scope;
✿ Physical color is not important;
✿ Hanging line is a bearish reversal pattern and also marks a top or strong resistance position. When prices rise, a hanging line is formed, indicating that sellers start to outnumber buyers.
The long lower shadow shows that sellers are pushing prices at lower opening prices. Buyers can push prices up.
This should attract our attention because it tells us that there are no extra buyers in the market to provide the necessary kinetic energy for further price increases.
✿ The long lower shadow is about twice or three times the entity;
✿ Little or no hatching;
✿ The upper limit of the entity’s trading range;
✿ The color of the candle line entity is not important, but the black entity is more bearish than the white entity.
Hanging wire: The conditions are the same as the hammer wire, but you have to wait for the next day’s signal verification. There is a problem with this. Even if the hammer wire is not also required to be verified?
1: The entity is at the upper end of the entire price range, and the color of the entity does not matter.
2: The length of the lower shadow is at least twice that of the entity.
3: This type of candle chart should not be shaded or even if it is short, it can be ignored. If there is a gap in the opening of the hanging line the next day, and the larger the gap, the more likely it is the top.