Which of these patterns signals an up trend, and which signals a downtrend?
1. Dark cloud cover
2. Morning star
3. Three black crows
If you answered “down”, “up”, “down” – you’d be absolutely right. And you’ve just passed your first test in candlestick theory!
With practice, reading candlesticks will become something second nature – a quick glance can give you confirmation to enter a trade you’re dithering over, or it can tell you that now is the moment to exit and take profits.
In the meantime, pin your cheatsheet up next to your desk.