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Master Doji Candlestick Trading! Unlock Your Potential!

Profiting from the crypto market – Doji candle trading

Doji candlesticks

The Doji star, better known as the Doji candlestick, is a unique candle that signals indecision in the crypto market. It shows that neither the crypto bulls nor bears are in control. However, not everything is that simple. The Doji candlestick has five variations. Each one of them shows something different. This is why it’s important to understand how to spot and read different Doji candle variations.

The Doji candlestick is characterized by its cross-like shape. This happens when a cryptocurrency pair opens and closes at the exact same level leaving a very small or even non-existent body while also exhibiting upper and lower wicks of equal length. While Doji mostly represents indecision in the market, it can also indicate a slowing momentum of an existing trend.

Doji candle in technical analysis

The Doji candle can be a very important piece of information as it can provide crypto traders with a moment to stop trading and reflect. However, it is important to consider the Doji candle in conjunction with other tools when timing your market exit point.

Doji candle variations

While the traditional Doji star shows indecisiveness, other variations can have different implications.
The picture on the screen will show different variations of the Doji candlestick, as well as its outcomes.

Trading the Doji candlestick

Traders use various ways to trade various Doji candlestick patterns. However, they all look for signals that complement the Doji candlestick in order to execute high-probability trades.

Trading the Doji star

 

The chart shows the Doji star appearing right at the bottom of an existing downtrend. This Doji pattern suggests that neither bulls nor bears are in control, meaning that a trend reversal is possible. At this point, it is crucial to take a look at supporting signals from other tools and indicators. This example makes use of the stochastic indicator, which is currently in the oversold territory, which adds to the bullish bias.

A popular Doji trading strategy involves looking for Dojis, which appear near support and resistance levels. The chart highlights the Dragonfly Doji, which appeared near trendline support. In this case, the Doji doesn’t appear at the top of the uptrend, so it doesn’t mark a trend reversal. The Dragonfly Doji, in this case, shows the rejection of lower-level prices. This potential bullish signal is further supported by the candle appearing near the trend support.

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Forex Candlesticks

Types of Bullish Candlesticks

In this article, we are going to get acquainted with some of the Bullish Candlesticks that the financial markets produce. Let’s get started.

 

Bullish Trackrail

Bullish Trackrail candlestick indicates that the market has been dominated strongly by the buyers. It is a combination of two candlesticks. The second candle is to be bullish and the length is very similar to the first candle. Both candles are with a long and solid body having tiny spikes or no spike at all.

Image: Bullish Trackrail

Bullish Engulfing

Bullish Engulfing Candle is formed with a combination of two candles. The second candle is to engulf and close above the first candle to be considered as a Bullish Engulfing candle. Some analysts/traders do not want to take first candle’s wick into account. However, if the second candle closes above the first candle’s wick, that is one good Bullish Engulfing Candle. A Bullish Engulfing Candle is considered as the strongest bullish reversal candle.

 

Image: Bullish Engulfing

Bullish Hammer

Bullish Hammer Candle is created when a candle closes with a small body with a long lower shadow. The body has to be tiny and it can be bullish or bearish. However, a little bullish body instead of a bearish body is more preferable among the buyers.

Image: Bullish Hammer

Spinning Top      

Spinning Top has a short body found in the middle with upper and lower wicks. The body can be bullish or bearish.

Image: Spinning Top

Bullish Pin Bar

Bullish Pin Bar is similar to Bullish Hammer. The only difference is a Bullish Pin Bar does not have any real body whereas a Bullish Hammer has a tiny body. Since a Pin Bar does not have a body, it has more rejection from the downside. Thus, Bullish Pin Bar is considered one of the most powerful bullish reversal candlesticks in the financial market.

Image: Bullish Pin Bar

Bullish Inside Bar

Bullish Inside Bar is produced with a combination of two candles. The second candle is to be bullish but shorter than the first candle. It is just the opposite of Bullish Engulfing Candlestick. A Bullish Inside Bar is considered the weakest bullish reversal candlestick.

Image: Bullish Inside Bar

Doji

A Doji Candle is formed where the price finishes very close to the same level. Thus, the candle has no body or a very tiny body. A Doji Candle itself is not a strong bullish reversal candle. However, if it is produced at a strong level of support, the market often reverses and goes towards the North.

 

 

Image: Doji

Bullish Spinning Top and Doji look very similar to the Bearish Spinning Top and Doji. The only difference between a Bullish Doji and Bearish Doji is a Bullish Doji is produced at a Support Level whereas a Bearish Doji is produced at a resistance level. The same goes for Spinning Top as well. All other bullish reversal candles’ are to be formed at a significant level of support as well. Their appearance is very different than the bearish reversal candles. Stay tuned with us to learn more about Candlestick.