Bullish candle
The close is above the open. Green shows the net rise within that candle.
- Top of body = close
- Bottom of body = open
Start here
What one candle tells you
Each candle summarizes four prices for one chosen period: open, high, low and close. The body runs between open and close; the thin shadows show the extremes.
Bearish candle
The close is below the open. Red shows the net fall within that candle.
- Top of body = open
- Bottom of body = close
Context changes meaning: A hammer shape after a decline and a hanging man shape after a rise look similar. The trend and the next candle help you interpret them.
One candle
Shape + location
A single candle can show a rejection or a strong close. It does not, by itself, guarantee the next move.
At the end of a decline
Hammer
A small body near the high with a lower shadow roughly twice the body or more. Little upper shadow. The location matters more than its colour.
How to read it: Look for evidence that selling was rejected at a support area; one candle does not prove a reversal.
After an advance
Hanging Man
The shape resembles a hammer but occurs after a rise. Its long lower shadow shows an intraday sell-off despite a close near the high.
How to read it: Watch the next candle for bearish confirmation rather than assuming the trend has turned.
After a decline
Inverted Hammer
A small body near the low with a long upper shadow, appearing after a downtrend. The same shape at an uptrend high is often called a shooting star.
How to read it: Wait for subsequent strength to distinguish a possible bullish reversal from a failed rally.
Near an uptrend high
Shooting Star
A small body near the low with a long upper shadow. Price moved higher during the candle but could not hold that gain.
How to read it: A later close below the pattern low can support a bearish reading; the candle alone is only a clue.
Directional single candle
Bullish Marubozu
A long green body with very small or absent wicks: the close is near the high and the open is near the low.
How to read it: It suggests strong buying during that candle, but follow-through is uncertain.
Directional single candle
Bearish Marubozu
A long red body with very small or absent wicks: the open is near the high and the close is near the low.
How to read it: It suggests strong selling during that candle, but follow-through is uncertain.
Small body, two shadows
Spinning Top
A small real body with upper and lower shadows. It can occur in either colour and often reflects hesitation.
How to read it: The surrounding trend, support or resistance, and later candles determine whether it becomes meaningful.
The Doji family
Indecision
Standard Doji
Open and close are at or very near the same price, leaving a very small body. The shadows show the range traded.
How to read it: It shows balance in that candle, not a trade direction. Use nearby levels and the next candle.
Wide intraday disagreement
Long-legged Doji
The open and close are close together while both upper and lower shadows are long.
How to read it: A larger range can reflect stronger disagreement; context and later confirmation still matter.
Upper-wick rejection
Gravestone Doji
The open and close are near the low; most of the candle is a long upper shadow.
How to read it: Near an uptrend high it can warn of rejection, but the next candles decide whether that rejection persists.
Lower-wick rejection
Dragonfly Doji
The open and close are near the high; most of the candle is a long lower shadow.
How to read it: Near the end of a decline it can suggest rejected selling, subject to confirmation.
Two candles
Look at how the second candle responds
Compare real bodies, gaps and the close relative to the previous body. Each sketch is schematic; actual markets do not draw perfect textbook shapes.
Two candles after a decline
Bullish Engulfing
A green real body surrounds the previous red real body. The body-to-body comparison is the key feature.
How to read it: At a base or support area, it may signal a change in pressure. Confirm the broader trend and risk level.
Two candles after an advance
Bearish Engulfing
A red real body surrounds the previous green real body. Its position after an up move gives the pattern context.
How to read it: It may indicate sellers taking control; wait to see whether the next price action confirms.
Bullish two-candle reversal
Piercing Pattern
A red candle is followed by a green candle that opens below the earlier low and closes above the midpoint of the red body, yet below its open.
How to read it: Its relevance rises when it appears after a downtrend; the midpoint is a useful visual check.
Bearish two-candle reversal
Dark Cloud Cover
A green candle is followed by a red candle that opens above the prior high and closes below the midpoint of the green body, yet above its open.
How to read it: It is evaluated after an uptrend. A piercing pattern is its bullish counterpart, not the same pattern at a different location.
Three candles
Star patterns show a shift in pressure
The middle candle shows a pause. The third candle matters because it shows whether the opposing side gained ground.
Three-candle bullish setup
Morning Star
A long red candle, a smaller middle candle, then a strong green candle. The middle candle may be a Doji.
How to read it: Look for it after a decline; the third candle gives the recovery its shape. Volume and follow-through can add context.
Three-candle bearish setup
Evening Star
A long green candle, a smaller middle candle, then a strong red candle. The middle candle may be a Doji.
How to read it: Look for it after an advance; the third candle shows the shift toward sellers.
If the middle candle is a Doji, the names become Morning Doji Star and Evening Doji Star. The formation still needs its broader trend context.
Before you decide
A four-step reading checklist
Use the pattern as evidence within a broader chart, not as a stand-alone prediction.
01 · Trend
Did it form after a rise, a decline or inside a range?
02 · Level
Is it near an area of support or resistance?
03 · Shape
Check body size, wick length, and the previous candles.
04 · Follow-through
Observe the next candle and plan how much you can risk.
Source and educational note
This original study page follows the topics in the PDF supplied for this lesson. The PDF credits Vidya Phad. The wording and diagrams here have been redrawn for web learning.
Pattern shapes express possible market behaviour, not guaranteed entries or returns. For a broader course outline, see NSE Academy’s Technical Analysis Module.