Candlestick Patterns: Every Major Pattern With Diagrams

Candlestick patterns are recurring shapes that one or a few candles form on a price chart, each one a compressed record of a fight between buyers and sellers. A hammer records a session in which sellers drove price down hard and then lost all of that ground by the close. A doji records a session that closed almost exactly where it opened. An engulfing candle swallows the whole of the previous session’s body; a morning star spreads a possible reversal across three candles; a shooting star shows buyers reaching for a new high and failing to hold it.

Traders sort these shapes into bullish candlestick patterns, which are defined after declines, bearish candlestick patterns, which are defined after advances, and a smaller neutral family that mostly records indecision. This chapter — part of Gale’s technical analysis guide — draws every major pattern with a diagram and gives each the same four-part treatment: what it looks like, where it appears, what it suggests, and when it fails.

One rule frames everything below. A candlestick pattern describes what just happened and suggests a tendency for what often follows. It does not command a purchase or a sale, and no pattern — however textbook-perfect — carries predictive certainty. Read the shapes as evidence to weigh alongside trend, levels and volume, the framework the overview chapter on technical analysis of stocks lays out in full.

Reading one candle before reading patterns

Every pattern below is built from the same four prices. A candle’s body spans the open and the close; its wicks mark the session’s high and low beyond the body. A green body means the close finished above the open; red means below.

Two proportions do most of the analytical work: how large the body is relative to the whole range, and where the body sits within it. A large body says one side dominated; a small body says near-stalemate; a body pinned to one end of a long range says one side won a battle that travelled a long way. If any of this feels new, read how to read candlestick charts first — this chapter assumes that anatomy. The wider vocabulary lives in the stock market terminology glossary.

Single candles of conviction and indecision

Two single candles bracket the spectrum of session character — total control and total stalemate — and every pattern after them is some arrangement of the two.

Marubozu

What it looks like: one long body with no wick at either end — the session opened at one extreme and closed at the other (a bearish marubozu, filled red, is the mirror). Where it appears: anywhere, but it says most at the start of a move out of a range or on a breakout day. What it suggests: one-sided conviction from open to close; the winning side never surrendered control. When it fails: deep into an extended trend it can be a final burst of enthusiasm, and on low volume it may reflect thin trade rather than broad participation.

Spinning top

What it looks like: a small body near the middle of the range with wicks of similar length above and below; either colour. Where it appears: everywhere — one of the most common candles on any chart, and it means most after a long directional run. What it suggests: indecision; neither side kept the session’s gains. When it fails: in a sideways range spinning tops are routine noise, and reading each one as a reversal manufactures signals out of churn.

The doji family

A doji forms when the close lands almost exactly on the open, leaving a body so thin it draws as a line. Every doji records stalemate; where that stalemate sits within the session’s range separates the four variants.

Standard doji

What it looks like: a thin horizontal body near the middle of a moderate range, forming a cross. Where it appears: on every chart at every timeframe; in quiet trade it is unremarkable. What it suggests: balance. After a strong advance or decline, the pressure driving the trend paused for at least one session. When it fails: in a drifting, low-volume market it means nothing — treating every doji as a turning point is the fastest way to over-trade a chart.

Long-legged doji

What it looks like: the same thin body, stranded in the middle of very long wicks on both sides. Where it appears: on high-volatility sessions — results days, policy announcements, sharp intraday reversals. What it suggests: violent disagreement that ended level; price travelled far in both directions and closed near the open. When it fails: the huge range pushes any invalidation level far away, and event-driven wicks often reflect one large order rather than a genuine shift of opinion.

Dragonfly doji

What it looks like: open, close and high sit together at the top; a long lower wick hangs beneath like a tail. Where it appears: it earns attention after a decline, where the wick shows an intraday sell-off fully bought back. What it suggests: sellers held control for much of the session and lost all of it by the close — hammer logic with an even thinner body. When it fails: without a preceding down-move it is just a wick, and one bought-back dip inside a persistent downtrend frequently precedes the next leg down.

Gravestone doji

What it looks like: open, close and low together at the bottom; a long upper wick stands above like a headstone. Where it appears: after an advance, often at or near a prior high where sellers wait. What it suggests: buyers pushed to a new high during the session and held none of it — the doji-thin cousin of the shooting star. When it fails: strong uptrends shrug off single rejected highs routinely; one gravestone against a rising trend and expanding volume is a comma, not a full stop.

Bullish candlestick patterns

Bullish patterns share a location requirement: each is defined after a decline. Identical shapes inside an uptrend or a flat range carry different names or no meaning at all.

Hammer

What it looks like: a small body at the top of the range, a lower wick at least twice the body’s height, little or no upper wick; either colour qualifies. Where it appears: after a decline — the same shape after a rise is a hanging man. What it suggests: sellers drove price sharply lower and buyers reversed the entire move by the close; possible demand at those lower prices. When it fails: a hammer alone is not a floor. In a persistent downtrend hammers print every few sessions and keep failing, which is why many wait for the next candle to close above the hammer’s body first.

Inverted hammer

What it looks like: a small body at the bottom of the range beneath a long upper wick — a shooting star’s shape in a hammer’s location. Where it appears: after a decline, often on the first session that probes higher. What it suggests: buyers attempted a rally and were pushed back, yet the close held near the open — demand tentatively testing the downtrend. When it fails: it is the weakest of the reversal singles because the rally attempt visibly failed; without a strong green candle straight after, the wick reads equally well as sellers still in charge.

Bullish engulfing

What it looks like: a small red body followed by a larger green body that completely covers it — the second candle opens below the first close and closes above the first open. Where it appears: after a decline; the steeper the fall, the more note traders take. What it suggests: the balance flipped inside one session — everything the sellers managed the previous day was overwhelmed. Expanding volume strengthens the reading; surfacing that participation is what the high-volume stocks screen does daily. When it fails: engulfing shapes appear constantly inside sideways ranges, where they degrade to noise, and a large green candle straight into resistance can exhaust buyers rather than launch them.

Morning star

What it looks like: three candles — a long red body, a small-bodied candle of either colour that gaps or drifts lower, then a long green body closing well into the first candle’s body. Where it appears: at the end of a decline; the middle candle is the “star”, standing apart at the low. What it suggests: sellers in control, then stalemate, then buyers in control — a transfer of momentum spread across three sessions. When it fails: completion takes three sessions of risk, and a morning star under heavy overhead supply — or with a third candle on shrinking volume — reverses far less often than the textbook drawing implies.

Piercing line

What it looks like: a long red candle, then a green candle that opens below the red candle’s low and closes above the midpoint of its body. Where it appears: after a decline, classically on a gap-down open around news or results. What it suggests: a session that began as capitulation reversed hard enough to reclaim more than half the prior day’s losses; the midpoint rule separates it from an ordinary bounce. When it fails: a close that pierces less than halfway is a weaker event — the definition is the filter — and even a textbook piercing line inside a strong downtrend often marks a pause, not a bottom.

Tweezer bottom

What it looks like: two adjacent candles — typically red then green — whose lows match almost exactly. Where it appears: after a decline, often at a level that has acted as support before; the support and resistance chapter explains why levels recur. What it suggests: sellers pressed to the same price twice and were refused twice. When it fails: “equal” lows are approximate in practice, which invites hindsight labelling — and a level tested twice can be tested a third time and give way. Tweezers describe a defence, not a guarantee it holds.

Bearish candlestick patterns

Each bearish pattern mirrors a bullish one, with the location requirement reversed: these are defined after an advance.

Hanging man

What it looks like: a hammer, exactly — small body on top, long lower wick — but printed after a rise; a red body sharpens the reading slightly. Where it appears: at or near the top of an advance. What it suggests: for the first time in the uptrend, sellers drove price down hard intraday; buyers recovered the ground, but the ease of the sell-off is the warning. When it fails: often — its record is weak because the session still closed strong. Without a red candle closing below its body soon after, an uptrend usually absorbs it without breaking stride.

Shooting star

What it looks like: a small body at the bottom of the range beneath a long upper wick — the inverted hammer’s shape after a rise. Where it appears: at the top of an advance, most pointedly when the wick probes above a prior high and fails there. What it suggests: buyers reached for new highs and were sold into heavily; the close surrendered nearly the whole attempt. When it fails: strong momentum runs print rejected highs routinely; against expanding volume and unbroken higher lows, one shooting star frequently gives way to a fresh high within days.

Bearish engulfing

What it looks like: a small green body swallowed by a larger red body — the second candle opens above the prior close and closes below the prior open. Where it appears: after an advance, most notably at a level the stock has failed at before. What it suggests: supply overwhelmed a full session of prior buying in one stroke; conviction changed sides. When it fails: like its bullish mirror it is noise inside trading ranges, and in a powerful uptrend a single engulfing candle is often just profit-taking — the structure of higher lows has to break before the pattern has consequences.

Evening star

What it looks like: the morning star inverted — a long green candle, a small-bodied star drifting higher, then a long red candle closing well into the first body. Where it appears: at the end of an advance; the star is the session where the rally stalled. What it suggests: momentum passing from buyers to stalemate to sellers across three sessions — a structured loss of control rather than a one-day scare. When it fails: confirmation costs three sessions of adverse movement, and in stocks that rarely gap, near-misses rounded up to “evening stars” litter every chart.

Dark cloud cover

What it looks like: a long green candle, then a red candle that opens above the green candle’s high and closes below the midpoint of its body. Where it appears: after an advance, classically on a gap-up open that fails around news or results. What it suggests: a session that began in optimism finished by erasing more than half the previous day’s gains; the open-above, close-deep combination is the point. When it fails: the midpoint rule is strict for a reason — shallower closes degrade into ordinary red days — and one failed gap on thin volume inside a strong trend is more often absorbed than obeyed.

Tweezer top

What it looks like: two adjacent candles — typically green then red — with highs that match almost exactly. Where it appears: after an advance, frequently at a prior peak or a round-number level where sellers cluster. What it suggests: two consecutive attempts at the same price were refused; supply sits there for now. When it fails: matched highs occur constantly by coincidence, making this the easiest pattern to over-identify — and resistance refused twice can still break on the third attempt, the situation the near-breakout stocks screen tracks from the other direction.

The cheat sheet: every pattern in one table

Pattern	Candles	Bias	Reliability note
Marubozu	1	Direction of body	A conviction reading, not a prediction; check volume
Spinning top	1	Neutral	Indecision only; direction comes from what follows
Standard doji	1	Neutral	Very common; meaningful mainly after a strong trend
Long-legged doji	1	Neutral	Volatility plus indecision; invalidation levels sit far away
Dragonfly doji	1	Bullish lean	Needs a decline before it and confirmation after
Gravestone doji	1	Bearish lean	Shooting-star logic with a thinner body
Hammer	1	Bullish	Only valid after a decline; wait for the confirming close
Inverted hammer	1	Bullish	Weakest of the reversal singles; confirmation is essential
Hanging man	1	Bearish	Same shape as the hammer; context defines it; modest record
Shooting star	1	Bearish	Stronger after an extended rise into a prior high
Bullish engulfing	2	Bullish	Among the more studied; size and volume carry the meaning
Bearish engulfing	2	Bearish	Frequent inside ranges, where it means little
Morning star	3	Bullish	Rarer; the three-candle structure filters some noise
Evening star	3	Bearish	Same; strict versions need gaps that liquid stocks rarely print
Tweezer bottom	2	Bullish	“Equal” lows are approximate; easy to label in hindsight
Tweezer top	2	Bearish	Easy to over-spot; needs an actual trend to reverse
Piercing line	2	Bullish	The midpoint rule is the filter; partial pierces fail more
Dark cloud cover	2	Bearish	Mirror of the piercing line; same strictness applies

How reliable are candlestick patterns?

This section exists because the shapes above are centuries old and the marketing built around them usually skips it.

Patterns are tendencies measured in hindsight. Every named pattern was catalogued by looking backwards at charts where the outcome was already known. That method finds real recurring behaviour, but it inherits the bias of hindsight: memorable successes got the patterns named, quiet failures went uncounted. Independent tests generally find hit rates for most individual patterns in a band around a coin toss — some modestly better, some worse. Suppose a pattern resolved in its expected direction 55 times out of 100 in some historical sample — an illustration, not a measured figure. That is simultaneously a genuine tendency and a 45% failure rate, which is why position sizing and invalidation levels do more for outcomes than pattern recognition ever will.

Context and volume matter more than the shape. The same hammer means different things at a level a stock has defended three times versus in the middle of nowhere; the same engulfing candle means different things on triple the average traded volume versus a listless session. A pattern is a sentence fragment; trend, level and participation are the sentence.

No pattern carries predictive certainty. Not one of the eighteen shapes above, in any combination, converts chart reading into foresight. SEBI’s study of individual equity F&O traders found that roughly nine in ten lost money over the three years examined — a population that includes plenty of people who could name every pattern on this page. Recognising shapes is a vocabulary, not an edge.

A daily pattern is a daily statement. A hammer on a daily chart says nothing about the weekly trend, and a five-minute shooting star resolves within the hour. Read patterns on the timeframe of the decision being made.

Where patterns earn their keep

Used honestly, candlestick patterns are a fast way to read the last few sessions’ psychology at a level that already matters. The workflow is short: establish the trend (the moving averages chapter covers the 20/50/200 conventions), mark the levels, and only then ask what the candles at those levels are saying. Momentum context sharpens the read — a hammer that forms while RSI is stretched below 30, the condition today’s list on the oversold stocks screen is built from, says more than either observation alone, and MACD adds the trend-momentum view an oscillator lacks.

The screens are not separate from the education: gale.in computes these indicators daily from exchange-published data — the live screens are this chapter applied to today’s market.

FAQ

Which candlestick pattern is the most reliable?

None is reliable in isolation, and rankings shift across markets and periods. The engulfing pair and the morning and evening stars are among the most studied because their multi-candle structure filters some noise. Usefulness rises with context — trend, level, volume — and falls without it.

What is the difference between a hammer and a hanging man?

Nothing in the shape; everything in the location. The identical candle — small body on top, long lower wick — is a hammer after a decline and a hanging man after an advance.

Is a doji bullish or bearish?

Neither, by itself. A doji records a session that closed where it opened — stalemate. It leans directional only through position and variant: a dragonfly after a decline leans bullish, a gravestone after an advance leans bearish, and both still need the next candles to confirm.

Do candlestick patterns work for intraday trading?

The shapes form on any timeframe, including five-minute charts. But shorter timeframes carry more noise, so failure rates rise, and brokerage, statutory charges and spread consume more of each smaller move.

How many candlestick patterns should a beginner learn?

A handful, deeply. The hammer, the doji family, the engulfing pair and the star formations cover most of what the rest re-express. Knowing why a hammer fails in a downtrend is worth more than naming thirty rare patterns on sight.

Do candlestick patterns work in Indian markets?

The candle arithmetic is identical on NSE and BSE data, and the patterns appear as they do anywhere. Usability depends on liquidity — thin smallcaps print wild wicks on tiny trades — and on events: results, circulars and regulatory announcements overwhelm any shape on the chart.

What to weigh

• Location before shape. Every pattern’s definition includes where it appears. A hammer in a downtrend at long-standing support is an observation; the same candle mid-range is wallpaper.
• Confirmation before conviction. Most patterns above fail often enough that the following candle — the close that confirms or denies — carries as much information as the pattern itself.
• Volume as the honesty check. A reversal pattern on expanding participation and the same pattern on a thin session are different events wearing the same shape.
• The base rate. Tendencies near a coin toss, minus costs, are not an income plan. Whatever a pattern suggests, position size and the predefined exit decide what a wrong read costs.
• The next chapter. Patterns describe sessions; support and resistance describes the levels that give them meaning. Read them together, then test both against the live screens.

Gale.in is not a SEBI-registered investment adviser or research analyst; this chapter is education, not a recommendation to buy or sell any security.