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Module B · Technical Analysis·Lesson 3

Candlestick Patterns

Recognize powerful reversal and continuation patterns

4 sections · 3 quiz questions · ~5 min read

Guided course path

Keep candlestick patterns inside the live track.

You are reading a reference lesson. The live course path gives you the lesson order, checks, saved progress, and next step. This is the clearest live path for trend, levels, candles, and multi-timeframe chart reading.

Closest track: Technical Analysis + Price ActionFirst lesson: The top-down framework
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Single Candle Patterns

The Doji has equal open and close (indecision). The Hammer has a long lower wick at support (bullish reversal). The Shooting Star has a long upper wick at resistance (bearish reversal). These are your first clues.
Candlestick Chart

Engulfing Patterns

A Bullish Engulfing occurs when a green candle completely engulfs the previous red candle — strong buying signal. A Bearish Engulfing is the opposite. These are among the most reliable reversal patterns.
Wick holds a magnifier over a hammer candle with a small body and long lower wick, showing that buyers stepped in after sellers pushed price down.Hammer at supportSmall bodyLong lower wick
Wick saysA hammer's long lower wick shows buyers caught a drop and pushed price back up.

Morning & Evening Stars

The Morning Star is a 3-candle bullish reversal: large red candle, small-bodied candle (indecision), then large green candle. The Evening Star is the bearish mirror. These form at key support and resistance levels.
Wick points at three candles under a lens, a big red one, a small pause and a big green one, teaching the shape of a Morning Star pattern.Morning StarBig redSmall pauseBig green
Wick saysA Morning Star is three candles: a big drop, a small pause, then a strong recovery.

Context Is Everything

A hammer at support is powerful. A hammer in the middle of nowhere is meaningless. Always read candlestick patterns in context — at key levels, after trends, and with volume confirmation. Pattern + location = edge.
Wick shows a green card for a hammer at a key level and a coral card for a hammer in the middle of nowhere, teaching that location gives a pattern its meaning.Means moreHammer at a keylevelMeans littleHammer in themiddle of nowhere
Wick saysA pattern matters most at a key level; in the middle of nowhere it means little.
Quick check

Did it stick?

Try to answer each one before you peek at the explanation.

1

Which candlestick pattern signals indecision in the market?

2

A Bullish Engulfing pattern is when a green candle completely covers the previous red candle.

3

Match the pattern to its signal:

Hammer at Support→Bullish Reversal
Shooting Star at Resistance→Bearish Reversal
Doji→Market Indecision