Candlestick is the "barometer" of market sentiment. By identifying candlestick patterns, one can clearly capture the changes in bullish and bearish strength, predicting trend reversals or continuation signals. The following 11 classic patterns are classified into reversal (trend turning), continuation (trend continuation after consolidation), and direction undecided, along with identification key points + practical tips, a must-have for newbies!

1. Bullish Reversal (Downtrend → Uptrend, Capture Trend Turning Point)

1. Double Bottom/W Bottom

• Pattern: Two tests of similar low points during a downtrend, forming a "W", with the middle high point as the "neckline".

• Logic: Two bottom tests without breaking, bears are exhausted, bulls take over.

• Practical: Breakthrough the neck line + increased volume (confirming buyers) to enter, set stop loss below the neck line / second low point.

2. Double Bottom/Broken Bottom Reversal

• Pattern: 3 or more low-level oscillations, ultimately breaking through the upper boundary of the range.

• Logic: Repeatedly testing the bottom without making new lows, support is very stable, the market shifts from "bearish dominance" to "bullish accumulation."

• Practical: Focus on "effective breakthrough" (volume + breaking the upper edge), add positions on pullbacks to support, set stop loss at the lower edge of the fluctuation range.

3. Arc Cup Handle

• Pattern: First, it slowly declines into a "rounded bottom" (U-shape), then after some oscillation at the bottom, it slightly retraces into a "cup and handle", ultimately breaking through the upper edge of the cup and handle.

• Logic: The arc bottom shows a decrease in bearish momentum, with bulls entering; the cup and handle is a "washout", digesting profit-taking.

• Practice: Cup handle amplitude ≤ cup body 1/3, break through the upper edge of the cup handle + enter with increased volume, target the "cup body height" (vertical distance from bottom to top of the cup).

2. Bearish Reversal (Rise → Fall, Top Escape Warning)

4. Head and Shoulders

• Pattern: Three high points in an uptrend (head highest, left and right shoulders slightly lower), with the low points connecting to form the "neckline".

• Logic: Right shoulder not as strong as the head, bullish strength weak, bearish counterattack, trend reversal.

• Practical: Break below the neckline + volume confirmation, enter short, set stop loss above the neckline/right shoulder high point, target at "head → vertical distance to the neckline" (downward equal volume).

5. Ascending Wedge

• Pattern: Uptrend, upper and lower bands converging (upper band slope < lower band), price increase narrowing.

• Logic: The upward slope is slowing, the bulls are lacking momentum, and the momentum is weakening, leading to a decline.

• Practice: Enter short when the lower boundary is broken, set the stop loss at the high point of the wedge upper boundary, the end of the upward pattern is more reliable (do not misjudge the low wedge).

3. Bullish Continuation (Rise after a consolidation, opportunity to add positions)

6. Ascending Triangle

• Pattern: Uptrend, with higher low pullbacks (ascending support line), encountering the same level of resistance at the highs, eventually breaking through the resistance.

• Logic: Buyer strength increases (support moves up), breaking resistance continues to rise.

• Practice: Enter the market when there is a volume breakout above resistance, set the stop-loss below the support line, and target the "height of the triangle" (the vertical distance from resistance to support).

7. Ascending Flag Pattern

• Pattern: After a rapid surge (flagpole), it enters a downward-sloping parallel consolidation (flag surface), breaking through the upper edge of the flag surface.

• Logic: Flagpole = strong upward trend; Flag surface = digesting profit-taking, after consolidation, bulls continue to attack.


• Practical: Flag consolidation ≤ 2 weeks, break above the upper edge + increased volume entry, target reference "flagpole length" (distance from flagpole starting point to pre-consolidation high).

4. Bearish Continuation (Continued decline after a pullback, adding to short positions)

8. Descending Flag Pattern

• Pattern: After a rapid decline (flagpole), it enters an upward-sloping parallel consolidation (flag), breaking below the lower edge of the flag.

• Logic: Flagpole = bearish strength; Flag surface = bullish consolidation, after consolidation, bearish continuation.

• Practical: Flag pattern consolidation with decreasing volume (bulls are weak), enter short when breaking below the lower edge, set stop loss at the upper edge of the flag, target reference "flagpole length" (equal amount downward).