The Most Powerful Continuation Patterns to Determine Whether a Trend Will Last

Do you want to know more about forex continuation patterns and candlestick patterns? Watch our latest video to learn how to find out when a price trend is likely to continue.

Candlestick continuation patterns – A simple explanation

A candlestick that signals continuation can come in several different forms. For example, it can be a very bullish candle that is an impulsive, during a fairly reliable uptrend. In other words, it seems that the buying pressure has picked back up. This obviously works in downtrend as well, as a strong red candle in a downtrend also suggests that the momentum is picking up. Essentially, those are the easiest continuation candlesticks to find.

We also have other candlesticks which can happen after pullbacks. For example, an uptrend you could get a hammer which shows that the selling has abated, and that the buyers are starting to come back into the marketplace. Remember, the hammer essentially is a candle with a long wick underneath it, showing that the market has run out of selling pressure. Obviously, a shooting star can mean the same thing, if we have recently bounced and what has been a longer-term downtrend. The shooting star is essentially the same thing as the hammer, only the long wick is above, meaning that the buyers have run out of momentum.

At this point in time, the thing that you need to remember is that it is all based upon momentum. That’s the key word, as it shows that the markets are looking likely to continue going in whatever direction it had been in over the longer term. Remember, markets don’t go in one direction forever, so pullbacks and uptrends and bounces in downtrends are to be expected. With this, looking for continuation candles can tell you when it’s time to get back involved in the market, or perhaps even add to your position.