The continuation candlestick pattern is one of the extremely popular candlestick patterns and often appears on price charts. For professional investors, the forex continuation candlestick pattern chart is a pattern that cannot be ignored. Join Learn Forex Trading to learn details and evaluate this model.
Learn the basic concept of the continuation candlestick pattern
During an uptrend or downtrend, candlesticks sometimes appear as characteristic patterns. This indicates the trend may continue or reverse. For reversal candlestick patterns, this shows that the current trend is ending. And besides that, the price may move in the opposite direction.
On the other hand, a continuation candlestick pattern is a collection of forming candlesticks. They often appear in the middle of a trend and signal to investors that a price trend has occurred. When these forex chart appear, traders can take the opportunity to place orders with a high level of safety.
Many candlestick patterns indicate trend continuation. This model can help investors see that the price trend is continuing in its direction. This pattern may not be similar to other reversal patterns available on the market.
Trend continuation candlestick patterns are considered signals for investors. The price is still moving in the right direction and there is no clear reversal. This model can provide investors with the most accurate signals that investors should not ignore.
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The continuation candlestick patterns that you need to understand clearly
Currently, there are 3 most common types of candlestick patterns that you need to understand. Each continuation model will have unique characteristics. Besides this type of model, investors can combine cup handle pattern. This is also one of the charts popular with investors.
Rising Three Methods Forex Trading Candlestick Pattern
With this candlestick pattern, you can easily see it when doing technical analysis. This candlestick pattern gives you quite accurate signals that the market is strongly dominated by buyers. Therefore, if the candle continues, the closing price of the market will also be very high and the market trend will also show signs of strengthening.
The first candle indicates a market dominated by buyers, where prices close very high. The third candle in the middle shows that buyers may be taking profits and retail investors are now embracing the trend that is causing the market to fall slightly.
The fifth candle shows that buyers easily took control, causing the market price to increase significantly compared to the first day’s closing level. Note that the three-candlestick pattern gives more accurate predictions. When the volume of the first and last two candles is greater than the volume of the three candles in the middle.
Continuation candlestick pattern Falling Three Methods for Investors
Just like the Rising candlestick chart pattern, the Falling candlestick pattern also has 5 similar candles. The first candle represents a strong downtrend. This has been formed from previous candles.
The three candles in the middle will fit into the body of the first candle. And finally, a small gap forms below the closing price. For the first time, you must sell at the lowest level to gain control of the market.
The three candles in the middle of the pattern including candles 2, 3, and 4 show that sellers are taking profits. Meanwhile, retail investors are buying at deep discounts. This is also one of the reasons why the market increased slightly today.
Bullish Harami candlestick pattern forex trading
The next trend continuation candlestick pattern is Bullish Harami. It is considered the pattern that works most often and best in an uptrend. This gives some signals that buyers have time to rest.
And it can continue to come back and create a stronger uptrend. The first-day candle is one of the candles with a strong uptrend and has a much larger body than the second-day candle. The second-day candle usually has a very small body and shadow.
The 2nd-day candle is usually a definite change and can become a bullish candle or a bearish candle. That candle shows quite a bit of pressure from buyers in the market. On the second day, the candlestick changed showing strong buying pressure and not too high selling pressure.
The bullish continuation candlestick pattern you should know
During an uptrend or downtrend, candlesticks sometimes appear as characteristic patterns. These patterns indicate whether the trend may continue or reverse.
Separating Lines and candlestick patterns tend to increase
This is a rather rare pattern but it can become a reliable signal. This pattern shows that the price will continue to move in the current trend. The breakout line appears in both uptrends and downtrends.
In any case, this model has contradictory characteristics and meanings. The lines separating the candlestick pattern continue the trend. And they must be expressed in an uptrend.
The first consists of a bearish candle and a bullish candle, with the same opening price as the closing price. During an uptrend, a bearish correction candlestick appears. But right after that was a strong green candle.
In that case, the opening price is not affected by the decline of the previous candle. Make sure the power source continues to operate. Opportunity to open a buy order immediately after the second candle closes, with the price continuing to increase sharply. You can place your stop loss below the center of the first candle. And set targets based on the R: R ratio or the nearest resistance level.
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Three Line Strike continuation candlestick chart pattern
The Three Line Strike is also a type of chart pattern that can occur in both uptrends and downtrends. In an uptrend, this continuation pattern continues the uptrend consisting of four candlesticks.
The first three candles are three equally bullish candles (the body of the candle is higher than the body of the previous candle). The last candle is a long-bodied bearish candle. It covers the entire body of the previous three candles. This candlestick pattern is quite controversial.
The last two candles form the Engulfing Line candlestick pattern which is quite popular. Trend trading in this pattern must be combined with other tools and indicators. This helps investors get a solid estimate of whether the market will reverse or continue its trend.
Conclude
With the continuation candlestick pattern mentioned above, it can be seen that this is a popular pattern. Besides using candlestick patterns, investors can refer to the combination with other indicators. Please follow Learn Forex Trading regularly to get more foreign exchange market news.
FAQs
What should you keep in mind when using the continuation candlestick pattern?
Although this model is very useful for investment. However, to have a good trading strategy, investors need to combine many other indicators.
What indicators should candlesticks combine with when analyzing?
For each investor, there will be familiar indicators when analyzing. Some indicators people can refer to: are RSI, MA, MACD,…
When investing, should you apply many indicators?
For new investors, it is necessary to master basic analysis and technical analysis knowledge. Applying many indicators without solid knowledge will give incorrect results.
