Trading Patterns Cheat Sheet

Quick recognition rules for candlestick and chart patterns. Always confirm with next candle and context (trend, level).

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Single Candlestick Patterns

Pattern	Shape	Where	Bias	Stop
Doji	Tiny body, wicks vary	Any (best at S/R)	Neutral / reversal if confirmed	Beyond pattern
Hammer	Small body at top, long lower wick	After decline, support	Bullish	Below hammer low
Hanging Man	Same as hammer	After rally, resistance	Bearish	Above high
Inverted Hammer	Small body at bottom, long upper wick	After decline, support	Bullish	Below low
Shooting Star	Same as inv. hammer	After rally, resistance	Bearish	Above high
Marubozu	Full body, no/small wicks	Trend or breakout	Direction of body	Beyond pattern

Recognition: Hammer = long lower wick, body at top. Shooting Star = long upper wick, body at bottom, after uptrend.

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Two Candlestick Patterns

Pattern	Candle 1	Candle 2	Bias
Bullish Engulfing	Bearish	Bullish, body engulfs 1	Bullish
Bearish Engulfing	Bullish	Bearish, body engulfs 1	Bearish
Piercing Line	Bearish	Bullish, opens lower, closes inside 1 (above mid)	Bullish
Dark Cloud Cover	Bullish	Bearish, opens higher, closes inside 1 (below mid)	Bearish
Tweezer Top	Any	Same high, rejection	Bearish
Tweezer Bottom	Any	Same low, hold	Bullish

Recognition: Engulfing = body of 2 completely contains body of 1. Tweezer = same extreme (high or low).

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Three Candlestick Patterns

Pattern	Candles	Bias
Morning Star	Bearish + small + Bullish (3 closes into 1’s body)	Bullish
Evening Star	Bullish + small + Bearish (3 closes into 1’s body)	Bearish
Three White Soldiers	Three bullish, each higher close	Bullish
Three Black Crows	Three bearish, each lower close	Bearish
Inside Bar	Current high < prior high, current low > prior low	Breakout (dir. TBD)
Outside Bar	Current range engulfs prior range	Direction of close

Recognition: Star = big, small, big (opposite). Inside = bar fully inside previous. Outside = previous bar fully inside current.

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Reversal Chart Patterns

Pattern	Break	Measured move	Stop
Head & Shoulders	Below neckline	Head to neckline, project down	Above RS or head
Inverse H&S	Above neckline	Head to neckline, project up	Below RS or head
Double Top	Below neckline (low between tops)	Top to neckline, project down	Above tops
Double Bottom	Above neckline (high between bottoms)	Bottom to neckline, project up	Below bottoms
Triple Top/Bottom	Beyond neckline	Same idea as double	Beyond pattern
Rounded Top	Below base of dome	—	Above dome
Rounded Bottom	Above rim of saucer	—	Below saucer

Recognition: H&S = 3 peaks, middle highest. Double = 2 equal highs (top) or lows (bottom). Neckline = line connecting the swing points between peaks/troughs.

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Continuation Chart Patterns

Pattern	Prior trend	Break	Stop	Target
Bull Flag	Up	Above flag upper line	Below flag low	Flagpole length up
Bear Flag	Down	Below flag lower line	Above flag high	Flagpole length down
Pennant	Any (sharp move)	Out of triangle	Opposite side	Flagpole length
Ascending Triangle	Often up	Above flat resistance	Below triangle	Height up
Descending Triangle	Often down	Below flat support	Above triangle	Height down
Symmetrical Triangle	Any	Either direction	Opposite side	Height in break dir.
Rectangle	Any	Above/below range	Inside rectangle	Height in break dir.
Cup and Handle	After decline	Above handle (rim)	Below handle	Cup depth up

Recognition: Flag = sharp move (pole) + parallel or sloping channel. Triangle = converging lines. Cup = U-shape; handle = small pullback near top.

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Quick Rules

1. Confirm: Prefer close beyond level or next candle in your direction.

2. Volume: Breakouts often need above-average volume.

3. Stop: Always beyond the pattern or level; never arbitrary.

4. Context: Reversal patterns at end of move; continuation in middle of trend.

5. False breakouts: Wait for close or retest; use buffer on stop.

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See full detail: 03 — Candlestick | 04 — Chart Patterns.