Technical Analysis
The 5 Most Important Candlestick Signals
These five candlestick signals appear frequently, have strong predictive value, and are detected by ScanTrade's AI.
Key rules
- Doji = indecision; look for context before acting
- Pin bar/hammer signals rejection of a price level
- Engulfing candles show momentum shift with full body absorption
- Inside bars signal compression before a directional move
- All candlestick signals require structural context to be meaningful
The most reliable candlestick signals are: doji (indecision at extremes), hammer/pin bar (bullish rejection after downtrend), shooting star (bearish rejection after uptrend), engulfing candles (momentum reversal), and inside bars (compression before breakout).
Context is everything — a hammer at support after a downtrend is high-probability. The same candle in the middle of a range is noise.