In the high-speed arena of intraday trading, price movement occurs in minutes—not days. When you trade, it is critical that you act upon the right visual cues to make sound decisions. There are thousands of patterns, but there are only a select few intraday candlestick patterns that yield the high probability signals day traders need to lock in profits quickly.
Within this guide, you will learn the most dependable intraday candlestick patterns, and more importantly, the essential context—support, resistance, and volume—that allows these candlestick patterns to actually work for day traders.
How to Understand Intraday Candlestick Patterns?
Candlestick patterns are the visual communication of the market. For day trading, you want to focus on the short timeframes (usually the 5-minute chart, or 15-minute chart), each candlestick is only a brief illustration of who is winning the buying and selling battle.
Understanding the Construction of a Candlestick: The body of the candle marks the range from the Opening price to the Closing price. The "thin lines" or wicks/shadows mark where prices are at the High and at the Low. A large candle body indicates price pressure, as long wicks indicate price rejection.
The Importance of Context: The most common mistake for new traders is to trade the pattern in isolation. A reliable intraday candlestick pattern is only reliable if it forms at a type of Support or Resistance level.
Confirmation is Important: Always seek confirmation to eliminate false signals. Confirmation typically includes the following:
Volume: The candle signifying the signal pattern should not only demonstrate an average pattern but also be strong enough in volume.
Next Candle: The candle directly after the pattern’s candle must confirm the true expected direction of the move.
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Best Intraday Bullish Reversal Patterns
Bullish Reversal Patterns indicate that the downtrend is complete and that new buyers are coming in to push the price higher.
The Hammer (and Tweezer Bottom)
A single candlestick with a small body at the top and a long lower wick (the length of the lower wick should be at least double the body). It demonstrates that sellers drove prices down aggressively, but buyers absorbed the pressure by buying back to the high.
Intraday Strategy: Look for this at a major Support level after a clear downtrend.
Entry: After the next candle, place your Buy open just above the High of the Hammer.
Stop-Loss: Place the Stop-Loss just below the Hammer’s low.
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Bullish Engulfing
This pattern consists of two candlesticks: a large green (bullish) candle that completely engulfs the body of the smaller red (bearish) candle. It is one of the strongest candlestick patterns as it displays an immediate and full change in momentum.
Intraday Strategy: This pattern is a more substantial signal than the Hammer.
Confirmation: Look for a high volume spike on the large green candle.
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Morning Star
It is a three-candle pattern: a long bearish candle, followed by a small-bodied (or uncertain) candle, before finally a long bullish candle that moves deep into the body of the previous bearish candle. This shows that sellers capitulated over several sessions.
Reliability: The longer the third bullish candle, the more reliable the bullish reversal.
Best Intraday Bearish Reversal Patterns
Bearish Reversal Patterns indicate the uptrend is losing steam and the sellers are gaining control to drive the price lower.
The Shooting Star
A single candlestick with a small body at the bottom and a long wick on the top. It is the bearish opposite of the Hammer pattern. It shows buyers have tried to drive up the price, as however, sellers quickly rejected the high, forcing the close back toward the low.
Intraday Strategy: Watch for this pattern at a major Resistance area following a clear uptrend.
Entry: Place a Sell (short) order just below the low of the Shooting Star before the next candle opens.
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Bearish Engulfing
A two-candle pattern that includes a large red (bearish) candle, which completely engulfs the body of the preceding small green (bullish) candle. This pattern implies that sellers have overwhelmed the buyers.
Intraday Strategy: This pattern is a favorite of beginner traders because of its clarity among intraday candlestick patterns.
Confirmation: Always confirm that the engulfing candle closes at a new short-term low on high volume.
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Evening Star
The bearish opposite of the Morning Star. This pattern includes a long bullish candlestick, followed by a small-bodied candle, then a long bearish candle. This pattern often provides a strong hint of a significant top.
Reliability: The pattern's strength is confirmed if the final bearish candle closes below the midpoint of the first bullish candle.
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Patterns of Indecision and Continuation
Not all patterns are intended for reversals; some may suggest only a pause, consolidation, or continuation of the current trend.
Doji Candlestick
The Doji pattern signals that the Open and Close prices are very similar, resulting in a very small body of a candle. This indicates indecision by market participants, buyers, and sellers are at a temporary equilibrium.
Strategy: The Doji is best as a cautionary signal.
In an uptrend, if we have a Doji that appears after a long green candle, this is a heads-up for a possible reversal.
The trade is only executed when the following candle after the Doji candle breaks the high or low of the Doji candle in the opposite direction of the trend.
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Conclusion
The best intraday candlestick patterns are not some magical trick, as they are simply the most prevalent and clearest visual signals of shifting supply and demand. You will increase your probability of success in the day trading space significantly just by focusing on the Hammer, Engulfing, and Shooting Star patterns, and consistently confirming your patterns with volume, support, and resistance levels.
Success in the markets takes discipline. If you plan to use these high probability candlestick patterns, ensure you practice in the simulator before placing real capital at risk.
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