Complete Guide: Reading Candlestick Patterns for Beginners — Advanced 77

📈 Complete Guide: Reading Candlestick Patterns for Beginners — Advanced 77

Candlestick patterns are the heart of technical analysis — a visual language that tells traders how the market feels. In 2025, learning to read these patterns isn’t just useful, it’s essential for anyone entering the world of stock trading or investing.

At AI Computer Classes – Indore, we train students to understand, recognize, and apply 77 advanced candlestick patterns step-by-step, blending traditional market wisdom with modern AI-based tools like Power BI, Excel, and Python.

This comprehensive guide will help you decode candlestick signals, predict price movements, and make confident trading decisions — whether you’re a beginner or ready for advanced techniques.

🧠 What Are Candlestick Patterns?

Candlestick charts originated in Japan over 300 years ago. Each candlestick represents price movement for a given period — it shows four key data points:

• Open Price
• Close Price
• High Price
• Low Price

The body of the candle shows the price range between open and close, while the wicks (or shadows) show highs and lows.

A green (or white) candle usually means prices went up, while a red (or black) candle shows a price drop.

🏆 Why Candlestick Patterns Matter

• They visualize market sentiment (bullish or bearish).
• They help identify reversals or continuations in trends.
• They support entry and exit decisions in trades.

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🧩 Understanding the Structure of a Candlestick

A candlestick has three main parts:

1. Upper Shadow (Wick): The highest traded price during the period.
2. Body: The difference between opening and closing prices.
3. Lower Shadow: The lowest traded price.

🔍 Example:

If a stock opens at ₹100, reaches ₹110, drops to ₹95, and closes at ₹108:

• It’s a bullish candle (green).
• Upper wick = ₹110 - ₹108 = ₹2
• Lower wick = ₹100 - ₹95 = ₹5

This shows that buyers dominated even though sellers tried to pull prices down.

📘 Basic Candlestick Patterns for Beginners

Here are the first few must-know patterns every trader should learn before diving into the advanced ones.

1. Doji

• Indicates indecision — open and close prices are nearly the same.
• Signals possible trend reversal.

2. Hammer

• Small body, long lower wick.
• Appears at the bottom of a downtrend → bullish reversal signal.

3. Shooting Star

• Small body, long upper wick.
• Appears after an uptrend → bearish reversal signal.

4. Engulfing Pattern

• A small candle followed by a larger opposite-colored candle that engulfs it.
• Bullish engulfing = uptrend continuation; bearish engulfing = reversal.

📊 Intermediate Candlestick Patterns

As you grow, these mid-level patterns reveal more complex market psychology.

🕯️ Morning Star

• A three-candle pattern showing a downtrend ending and a new uptrend beginning.

🕯️ Evening Star

• The opposite of Morning Star, signaling a top or bearish reversal.

🕯️ Harami

• A small candle within the previous candle’s body — shows market uncertainty and possible breakout.

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📈 Advanced 77 Candlestick Patterns — Overview

The Advanced 77 concept at AI Computer Classes goes beyond basics — it includes multi-day patterns, combined signals, and AI-driven interpretation.

Here are a few from the advanced list:

1. Three White Soldiers: Strong bullish continuation.
2. Three Black Crows: Strong bearish reversal.
3. Tweezer Tops and Bottoms: Dual candle reversals.
4. Rising & Falling Windows: Gaps that indicate momentum shifts.
5. Dragonfly & Gravestone Doji: Precise reversal markers.
6. Piercing Pattern: Bullish signal after a major dip.
7. Dark Cloud Cover: Bearish signal during an uptrend.

In our Advanced 77 program, students also learn how to use machine learning models to detect these automatically in historical data.

🧮 How AI & Python Help in Analyzing Patterns

Modern traders use Python to identify and analyze candlestick patterns at scale.

Here’s a small example:

import pandas as pd
import talib

data = pd.read_csv("stock_data.csv")
data['hammer'] = talib.CDLHAMMER(data['Open'], data['High'], data['Low'], data['Close'])
print(data[data['hammer'] != 0])

This code uses the TA-Lib library to detect hammer patterns automatically, saving time and improving accuracy.

You can also integrate Power BI dashboards to visualize how patterns correlate with profits or losses — turning your trading strategy into data-driven success.

💹 Combining Candlestick Patterns with Volume Analysis

Volume confirms candlestick signals.

For instance:

• A Hammer with high volume = strong bullish reversal.
• A Doji with low volume = weak or uncertain signal.

By combining price and volume, traders increase accuracy and avoid false signals.

💡 Learn from Experts at AI Computer Classes – Indore!

Practice live stock analysis and chart reading with instructors guiding every trade.

👉 Start learning today at AI Computer Classes

📍 Located in Old Palasia, Indore

🧭 How to Practice Reading Candlestick Charts

Here’s a simple 3-step routine to get better daily:

1. Choose a Stock: Prefer NIFTY 50 or high-volume stocks.
2. Analyze the Chart: Identify 2–3 patterns every day.
3. Record Your Observations: Use Excel to log patterns, entry, and exit results.

Over time, you’ll develop pattern recognition instinct — the most valuable skill in trading.

🚀 Why Learn at AI Computer Classes – Indore?

At AI Computer Classes, students don’t just learn theory — they practice on live market data using:

• TradingView
• Python-based analysis
• AI-driven pattern recognition
• Data visualization tools like Power BI

We focus on practical, industry-ready skills so learners can analyze, trade, and build automated trading systems confidently.

🎯 Conclusion

Candlestick patterns are a trader’s language — they narrate the story of fear, greed, and opportunity.

Mastering these patterns, especially the Advanced 77, helps traders read the market like professionals.

Whether you’re aiming to be a retail trader, financial analyst, or algorithmic trading expert, start learning these skills now.

Join AI Computer Classes – Indore, where technical analysis meets artificial intelligence. Unlock your trading potential and turn insights into smart investment decisions.

📞 Contact AI Computer Classes – Indore

✉ Email: hello@aicomputerclasses.com

📱 Phone: +91 91113 33255

📍 Address: 208, Captain CS Naidu Building, near Greater Kailash Road, opposite School of Excellence For Eye, Opposite Grotto Arcade, Old Palasia, Indore, Madhya Pradesh 452018

🌐 Website: www.aicomputerclasses.com