5 Most Powerful Bullish Candlestick Patterns

Bullish candlestick patterns indicate a price reversal in the uptrend and show the downtrend is about to end. This can be a single or multiple candlestick pattern to form on the charts.

There are some important things to notice for bullish candlestick patterns:

• It should be formed at the end of a downtrend
• It should be near a strong resistance zone
• It should be confirmed with other trading indicators such as high trading volume

In this article, we will learn about the top 5 most powerful bullish candlestick patterns.

If you want to learn more about candlestick chart patterns you can read 35 Candlestick Patterns Every Traders Must Know.

Hammer – Most Powerful Bullish Candlestick Patterns

Hammer is one of the most considered bullish reversal patterns used for building long positions. It should be formed at the bottom of the downtrend and near a strong price-support zone.

This candlestick pattern has a long shadow and the length is almost double that of the real body.

This pattern must be formed at the bottom of a downtrend.

The presence of a long shadow in this pattern indicates that bears were trying to take the prices lower further but they were unable to do so and the small body at the top shows that the bulls were able to bring the prices to the top successfully.

The formation of a bullish candlestick after the hammer pattern indicates that the reversal has taken place. Here is an example of bullish candlestick patterns on the daily chart of Nifty 50.

Piercing Pattern

This pattern is formed near the end of the downtrend and acts strongly if there is a strong support zone present. This pattern has a higher potential for bullish reversal than other reversal patterns.

This pattern is made up of two candlestick patterns where the first one is a bearish candlestick pattern and the second one is a bullish piercing pattern.

The bearish candlestick should have a large real body, and the second bullish candlestick should be below the low of the previous candlestick and should close above the middle of the real body of the first candlestick.

There are some important things to notice for piercing candlestick patterns:

• The trend should be a downtrend
• The size of the candlestick shows the strength of the reversal about to take place.
• The gap between the bearish and bullish candlesticks will show the strength of the reversal.
• Both the bearish and bullish candles must have a large body.

Example of the piercing pattern in the daily chart of Sunpharma Industries Ltd.

Bullish Engulfing

This candle formation shows the rise in the buying pressure of markets which shows a bullish reversal. This bullish candle pattern indicates the reversal of a downtrend as more buyers start building their positions after a long downtrend in the market.

This pattern consists of two candles where the second candle totally engulfs the body of the previous red candle.

When trading with the bullish engulfing pattern the ongoing trend should be a downtrend and it also indicates the timing to close the ongoing short position for the short position holders.

This pattern is a type of continuation pattern and shows the ongoing trend will continue further. If the ongoing trend is bullish and an engulfing pattern is formed it shows that the trend will continue the upmove.

RSI & volume are the best confirmations to decide the strength of this candle pattern.

If you want to learn more about candlestick chart patterns you can read 35 Candlestick Patterns Every Traders Must Know.

The Morning Star

This is one of the rare candlestick patterns that require three candlesticks for its formation and shows a strong bullish reversal.

As it is formed at the end of the downtrend it indicates the reversal to an uptrend.

It is made up of three candlestick patterns; the first should be a bearish candlestick, the second one should be either a bearish or bullish with a small body, and the last one should be definitely a bullish candle with a good body.

The ongoing trend should be bearish if you want to trade with the Morning Star Pattern.

The Three White Soldiers

This candlestick pattern forms at the end of the downtrend and it indicates a strong bullish reversal.

This pattern is also made up of three bullish candles and each has a body with no shadow with them. This large-bodied candle shows the strong buying pressure created by the buyers. Every candle opens in the range of the body of the previous candle.

Example of a daily chart of USD/INR that shows us how Three Soldiers Candlesticks is formed after a downtrend:

Conclusion

When a trend is about to turn from a downward to an upward direction, the bullish candlestick patterns that were previously mentioned can provide us with crucial signs. It’s important to remember that all of these bullish candlesticks should be utilized in conjunction with other technical indicators in order to validate the signal they provide.

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