Putting it together

Summary

Reading candles well means reading them in context. Start with the trend on a higher timeframe, mark the levels where the price turned before, and only then look at what the latest candles are doing near those levels. A hammer in the middle of nowhere means little; the same hammer at a level that held three times before is worth noticing. Write down what you expected and check it later — that is how the skill grows.

Key points

• Trend first, then levels, then the latest candles.
• The same pattern means more at a level that held before.
• Keep notes of what you expected and what happened.

Check yourself

Where does a candle pattern usually matter most?

Practice