Home Technical Analysis Candle Patterns: Researched Tested & Proven

Candle Patterns: Researched Tested & Proven

Candle patterns are visual formations made up of one or more candlesticks that can be used to predict the direction of future price movements.

Our original candlestick research meticulously explains and tests the most important patterns to reveal success rates, reliability, profitability, and how to trade them.

These articles have an unparalleled depth of analysis and practical applicability to the trading world.

Is the Shooting Star Candle Worth Trading? Our Data Says Yes!

Based on our 568 years of backtested data, the Shooting Star candle is profitable. It has a 57.1% upside success rate and an average winning trade of 3.6%. Each trade made using a shooting star nets an average of 0.56% profit.

3,735 Bullish Engulfing Candle Trades Test its Reliability

Our research shows the Bullish Engulfing candle is not as profitable as most traders believe. Based on 568 years of data, it has a 55% success rate and an average win of 3.5%.

9,894 Trades Test a Spinning Top Candle Pattern’s Reliability

Our original research found that the Spinning Top candle is a bullish pattern, with a 55.9% success rate and a 3.7% average winning trade. Trading with a Spinning Top yields an average profit of 0.49%, ranking it the 10th best candle to trade.

Our Data Research Proves Tweezer Candle Patterns Don’t Work!

Based on our testing of 1,892 trades, the tweezer top and bottom patterns are highly unreliable and unprofitable. These patterns exhibit a reward-to-risk ratio of only 1.07, with 50% of trades resulting in losses. Relying on tweezers as a trading strategy yields poor results.

Our Data Proves Why Heikin-Ashi Charts Are Best for Traders

I backtested 360 years of data on the 30 most important US stocks, and our findings prove that Heikin-Ashi chart strategies outperform 66% of equities vs. a buy-and-hold strategy.

Bearish Engulfing Candles Explained & Reliability Tested

Our research shows the Bearish Engulfing candle is an accurate and profitable pattern. Our 568 years of data reveals a 57% success rate and an average win of 3.7%.

Are Bullish Harami Candles Profitable? We Test It?

Our research shows Bullish Harami and Bullish Harami Cross are profitable patterns. Based on 1,112 years of data, the bullish Harami has an average profit per trade of 0.5% and the Harami Cross 0.58%.

We Test Bullish & Bearish Marubozu Candles for Reliability

Our research shows Bearish Marubozu candles are among the most profitable patterns. Based on 568 years of data, it has a 56.1% success rate and an average win of 4.1%. Conversely, the Bullish Marubozu is one of the worst.

Dragonfly Doji Explained: Is it Reliable? I Test It!

The Dragonfly Doji is a candlestick chart pattern that indicates an equilibrium between buyers and sellers after a day of trading volatility. Our 1,703 test trades prove it can be profitable under the right circumstances, but the margins are thin.

We Test the Inverted Hammer Candle Pattern! Is It Worth It?

Our research shows the Inverted Hammer is the most accurate and profitable candlestick pattern. Used as a bullish signal, it has a 60% success rate and an average win of 4.2%, based on 588 years of data.

Hammer Candlesticks Patterns Explained & Reliability Tested

According to 2,219 tested trades, a Hammer is extremely unreliable and unprofitable. It has a low % accuracy rate of 52.1%, resulting in a razor-thin 0.18% profit per trade.

Trading a Doji Candle Explained: I Backtest It For Reliability!

A Doji candlestick chart pattern indicates a battle between buyers and sellers, ending in equilibrium. The Doji marks a potential trend reversal. Is the Doji pattern profitable or accurate? Our evidence suggests its profitability is marginal.

Bearish Harami Pattern: 5,624 Trades Tested for Reliability!

Our research shows Bearish Harami and Bearish Harami Cross are profitable patterns. Based on 1,136 years of data, the Bullish Harami has an average profit per trade of 0.48% and the Harami Cross 0.57%.

Gravestone Doji Explained & Reliability Tested!

A Gravestone Doji candle indicates a battle between buyers and sellers and is considered bearish. Our 1,553 test trades prove it is the third most profitable candle pattern. But it does not work as most traders believe.

How to Read Candlestick Charts Using 5 Reliable Patterns

You can read candlestick charts using pattern recognition software to identify five reliable patterns, the Inverted Hammer, Bearish Marubozu, Gravestone Doji, Bearish Engulfing, and Bullish Harami Cross.

Top 10 Reliable Candle Patterns: 56,680 Trades Tested

Our 56,680 test trades show the most reliable candlestick formations are the Inverted Hammer (60% success rate), Bearish Marubozu (56.1%), Gravestone Doji (57%), and Bearish Engulfing (57%).

5 Best Candlestick & Chart Pattern Recognition Software 2024

Our 20-point test reveals the best stock chart candlestick pattern recognition software are TrendSpider, TradingView, and Finviz.

Our Best Training & Strategies

Liberated Stock Trader Pro: Learn Stock Market Investing

Learn stock market investing with the complete online stock trading course by Barry D. Moore, a certified financial analyst from the International Federation of Technical Analysts (IFTA).

ETF Investing Strategy: MOSES Improves Performance & Lowers Risk

The MOSES ETF investing strategy is a powerful suite of indicators meticulously backtested over 100 years. Designed to empower you to outperform the market, it equips you with the tools to navigate major stock market crashes and unlock greater investing performance.

LiberatedStockTrader’s Strategy Beat the Market By 102%

Decades of research and testing unveiled the Liberated Stock Trader Beat the Market System. Our 9-year, backtested, and proven strategy targets 35 financially healthy high-growth stocks, producing a track record of beating the S&P 500 by 102%.

TradingView Review 2024: Tested by LiberatedStockTrader

LiberatedStockTrader's review testing awards TradingView 4.8 stars due to excellent stock chart analysis, pattern recognition, screening, and backtesting. TradingView is our top recommendation for US and international traders.

Stock Rover Review 2024: Tested by LiberatedStockTrader

LiberatedStockTrader's review testing awards Stock Rover 4.7 stars. Its advanced screening, research, and portfolio tools are ideal for US value, income, and growth investors. With 650 financial metrics on 10,000 stocks and 44,000 ETFs, we rate Stock Rover the number one stock screener.

Trade Ideas Review 2024: AI Tested by LiberatedStockTrader

Our in-depth testing shows Trade Ideas is the ultimate black box AI-powered day trading signal platform with built-in automated bot trading. Three automated Holly AI systems pinpoint trading signals for day traders.

TrendSpider Review: Big 2024 Updates! Is It Now The Best?

Our TrendSpider testing finds it is ideal for US traders wanting AI-automated charting, pattern recognition, and backtesting of stocks, indices, futures, and currencies.

Benzinga Pro Real-time News Tested by LiberatedStockTrader

Our testing shows Benzinga Pro is best for US traders who want a high-speed, actionable, real-time news feed at 1/10th of the price of a Bloomberg terminal. I recommended Benzinga Pro for active day traders and investors who trade news events.

MetaStock Review 2024: Tested by LiberatedStockTrader

Our MetaStock review and test reveal an excellent platform for traders, with 300+ charts and indicators for stocks, ETFs, bonds & forex globally. Metastock has solid backtesting and forecasting, and Refinitiv/Xenith provides powerful real-time news and screening.