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Some Popular Patterns of Japanese Candlestick

Marubozu

In Japanese, Marubozu means close cropped or close-cut. Bald or Shaven Head are more commonly used in candlestick analysis. It's meaning reflects the fact that there are no shadows extending from either end of the body.

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White Maruboza

The White Marubozu is a long white body with no shadows on either end. This is an extremely strong pattern. Consider how it is formed. It opens on the low and immediately heads up. It continues upward until it closes, on its high. Counter to the Black Marubozu, it is often the first part of a bullish continuation pattern or bearish reversal pattern. It is called a Major Yang or Marubozu of Yang.

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Black Marubozu

A long black body with no shadows at either end is known as a Black Marubozu. It is considered a weak indicator. It is often identified in a bearish continuation or bullish reversal pattern, especially if it occurs during a downtrend. A long black candle could represent the final sell off, making it an "alert" to a bullish reversal setting up. The Japanese often call it the Major Yin or Marubozu of Yin.

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Opening Marubozu


The Opening Marubozu has no shadows extending from the open price end of the body. A white body would not have a shadow at the bottom end , the black candle would not have a shadow at it's top end. Though these are strong signals, they are not as strong as the Closing Marubozu.

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Closing Marubozu

A Closing Marubozu has no shadow at it's closing end. A white body will not have a shadow at the top. A black body will not have a shadow at the bottom. In both cases, these are strong signals corresponding to the direction that they each represent.

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Spinning Tops


Candlesticks with a long upper shadow, long lower shadow and small real bodies are called spinning tops. The color of the real body is not very important. The pattern indicates the indecision between the buyers and sellers.

The small real body (whether hollow or filled) shows little movement from open to close, and the shadows indicate that both buyers and sellers were fighting but nobody could gain the upper hand.

Even though the session opened and closed with little change, prices moved significantly higher and lower in the meantime. Neither buyers nor sellers could gain the upper hand, and the result was a standoff.

If a spinning top forms during an uptrend, this usually means there aren't many buyers left and a possible reversal in direction could occur.

If a spinning top forms during a downtrend, this usually means there aren't many sellers left and a possible reversal in direction could occur.

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Doji


The Doji is one of the most important signals in candlestick analysis. It is formed when the open and the close are the same or very near the same. The lengths of the shadows can vary.
Doji candles suggest indecision or a struggle for turf positioning between buyers and sellers. Prices move above and below the open price during the session, but close at or very near the open price. Neither buyers nor sellers were able to gain control and the result was essentially a draw. There are four special types of Doji candlesticks. The length of the upper and lower shadows can vary and the resulting candlestick looks like a cross, inverted cross or plus sign. The word "Doji" refers to both the singular and plural form.
When a Doji forms on your chart, pay special attention to the preceding candlesticks.
If a Doji forms after a series of candlesticks with long hollow bodies (like White Marubozus), the Doji signals that the buyers are becoming exhausted and weakening. In order for price to continue rising, more buyers are needed but there aren't anymore! Sellers are licking their chops and are looking to come in and drive the price back down.

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Types of Doji

Long-Legged Doji: Long Legged Doji shows that there is a great amount of indecision in the market. This pattern is formed when prices trade well above and below the day's opening price, but then close almost at the same level as the opening price. It means that the end result is not different from the initial open despite the whole excitement and high volatility during the day. This implies a loss of sense of direction and that there is a great amount of indecision in the market.

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Dragonfly Doji: Dragonfly doji is the bullish counterpart to the gravestone doji, where the open, high, and close are at the high of the day. The dragonfly doji has a higher success rate when the candle forms at a market bottoms. The psychology behind the candle is that the bears pushed the security down to an unsustainable level and the bulls are able to push the security up to its high by the end of the session. The dragonfly doji is similar to the bullish hammer pattern, except for the fact the dragonfly doji has no body. Traders should wait for the high of the candle to be exceeded prior to
taking a long position.

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Gravestone Doji: The Gravestone Doji is a significant bearish reversal candlestick pattern that mainly occurs at the top of uptrends. The Gravestone Doji is created when the open, low, and close are the same or about the same price (Where the open, low, and close are exactly the same price is quite rare). The most important part of the Graveston Doji is the long upper shadow. The long upper shadow is generally interpreted by technicians as meaning that the market is testing to find where supply and potential resistance is located.The construction of the Gravestone Doji pattern occurs when bulls are able to press prices upward.
However, an area of resistance is found at the high of the day and selling pressure is able to push prices back down to the opening price. Therefore, the bullish advance upward was entirely rejected by the bears.

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Four Price Doji: A four price doji is a candlestick where the open, high, low, and close are all the same. This is the purest example of indecision between the bulls and the bears. As you can imagine this candlestick is extremely rare and will only show up when trading volume is extremely low.

[sethu45]

Very Interesting and hope we will be getting the complete candlestick pattterns no sooner. Good work.
sethuraman

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Morning Doji Star: A three day bullish reversal pattern that is very similar to the Morning Star. The first day is in a downtrend with a long black body. The next day opens lower with a Doji that has a small trading range. The last day closes above the midpoint of the first day.

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Evening Doji Star: A three day bearish reversal pattern similar to the Evening Star. The uptrend continues with a large white body. The next day opens higher, trades in a small range, then closes at its open (Doji). The next day closes below the midpoint of the body of the first day

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Bullish Abandoned Baby: A rare reversal pattern characterized by a gap followed by a Doji, which is then followed by another gap in the opposite direction. The shadows on the Doji must completely gap below the shadows of the first and third day.