The Main Indicators of Strong Bullish Patterns

A pattern is a candlestick pattern that helps predict future price movement. Patterns are divided into three groups: bullish, bearish, and reversal. The first two groups confirm a trend movement during a temporary consolidation, reversal patterns warn of a change in price direction. Trading in patterns is considered one of the most effective trading systems because the formation of patterns has a psychological nature. Candlestick patterns are formed because of the same actions of the majority. And by these formations, you can understand what the majority will do next.

In this series of articles you will learn:

• What bullish patterns are and when they form.
• What are the best bullish patterns and how to find them quickly on a chart.
• When patterns are used in trading.
• The review includes practical examples.
  
  

What are bullish patterns and how they are formed?

Bullish patterns are candlestick patterns, which indicate the beginning or continuation of an upward movement. They can form in several cases:

On a downtrend. A downtrend ending in a bullish pattern indicates that the volume of sellers has decreased - the number of those willing to sell the asset is less than the number of those willing to buy it. It refers to the reversal pattern and shows that a rising trend begins.

On the upward movement. In any trend, there are corrections and consolidation zones. A bullish pattern shows that the buyers haven't "run out of steam" yet and a pause or correction is temporary. For example, a bullish pattern with a breakdown of the resistance level is a signal for the resumption of an upward movement.

In a flat state. During a flat condition, it's not clear which way the price will go. The breakdown of resistance or support levels can be false. But if a bullish pattern is formed at the moment of breakdown, there is a probability of upward movement.

The fact that a pattern is formed depends on: the size of the candlestick body and its relationship to the previous candlesticks, the size of the shadow and its relationship to the size of the candlestick body, the shape of the candlestick formation.

In the following article, you will learn the top 7 best candlestick analysis patterns that determine an uptrend

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