Chart Patterns

Candlestick patterns are technical indicator tools that guide investors and traders in seeing the trend of the stock. It is interesting that these patterns recur in the market when one would look at the historical price behavior of a stock in a long time frame. By analyzing chart patterns, an investor or trader can foresee the likely move of a stock in the future.

Candlestick patterns are considered a more reliable tool in foreseeing the future movement of a stock than candlesticks because patterns are built upon series of candlesticks that reinforce each other and provide more data for the investor or trader. Candlestick patterns can be helpful in seeing the price movement of stock in longer time frames whereas candlesticks may be more useful in guiding the investor/trader in shorter time frames.

Combined with technical indicators, chart patterns become a powerful tool in determining the future movement of a stock’s price with accuracy.