How to Confirm a relatively strong reversal/ rejection of a short-term trend using candlestick patterns?

What are the important factors to confirm the reliability of the candlestick chart patterns?

I have my way of looking at the candlesticks and analyzing their characteristics, like who dominated (buyers/seller), What is the size of the candle as compared to previous candles, Where the body is placed (upper part or lower part of the trading range), comparing preceding candles with the current candle’s range and the volume during the whole period.

Most Importantly I analyze the subsequent – follow-up candle formed after the candlestick pattern to enter the trade.

The closings are always important in the technical analysis prospect.

The higher VOLUME during the pattern formation, the more reliable the patterns tend to blow off, as there is an increase in the participants.

How do you spot a reversal candle?

Candlesticks reduce the need to compare several trading charts to understand asset price movement since they capture the opening, closing, high, and low of an underlying asset in a single bar pattern. In addition to this, candlestick charts may be used to anticipate potential trend reversals in the trendline. There are several candlestick forms indicating trend reversals, each with varying degrees of validity. 

How do you know if a candlestick pattern is strong?

The closing price of the first candlestick and the opening price of the green candlestick often have a significant downward gap. The price being pushed up to or above the mid-price from the previous day suggests there is significant buying pressure.

How do you know if a bullish reversal happens?

Bullish reversal patterns should form within a downtrend. Otherwise, it’s a continuation pattern rather than a bullish pattern. Most bullish reversal patterns need more bullish movement. To put it another way, they must be followed by an upward price movement, which can take the form of a gap up or a lengthy hollow candlestick and be accompanied by a large trading volume. Within three days following the pattern, this confirmation should be shown.

Which is a phrase used to describe a bearish candlestick pattern that may predict the reversal of an uptrend?

The term “three black crows” refers to a bearish candlestick pattern that may indicate the end of an upswing. Candlestick charts display a security’s opening, high, low, and closing prices for the day. The candlestick is white or green for equities that are rising. They are either black or red when they fall.

What is the best indicator for trend reversal?

If you are a price action trader, you might wish to utilise a trendline to indicate the trend’s direction. A trend reversal would be indicated by the price closing above the tool’s dynamic support (uptrend) or resistance (downtrend) level, which also serves as a level where pullbacks are likely to reverse.

Many indicators, including moving averages, the moving average convergence and divergence (MACD), Donchian and Keltner channels, Bollinger Bands, as well as oscillators like the relative strength index (RSI) and stochastic, can be used by someone who only uses indicators to identify a trend reversal.