Candlestick
Pattern Library
Master the ancient art of Japanese candlestick patterns. Learn to read market psychology through price action and identify high-probability trade setups.
Bullish Patterns
Bearish Patterns
Reversal Signals
Crash Indicators
Major Market Crash IndicatorsHigh Alert
The bearish patterns section includes 4 critical patterns that have historically preceded major market crashes and 30-70% declines. These patterns appear on weekly and monthly timeframes and require immediate attention:
Bitcoin Example: These patterns appeared throughout 2021-2022 before the 77% crash from $69K to $15K. Similar patterns preceded the 2018 crash (84% drop), 2013 crash (87% drop), and major stock market crashes in 2000 and 2008.
Bullish Reversal Patterns
These patterns typically appear at the end of downtrends and signal potential upward reversals. Look for these at support levels for highest probability setups.
Historical Market Crashes & Patterns
2008 Financial Crisis
S&P 500: -57% decline from peak
Patterns: Multiple bearish engulfing candles at resistance throughout 2007-2008. Rising wedge breakdown in Oct 2007. Death cross confirmation Jan 2008. Three black crows pattern appeared multiple times during the decline.
2000 Dot-Com Crash
NASDAQ: -78% decline over 2.5 years
Patterns: Massive shooting stars at March 2000 peak. Evening star formation at 5,000 level. Bearish engulfing patterns throughout the decline. Classic distribution phase with lower highs and lower lows.
2020 COVID Crash
S&P 500: -34% in 33 days (fastest bear market)
Patterns: Dark cloud cover at Feb 2020 highs. Consecutive gap downs (unprecedented). Multiple long red candles with no bounces. Volume spike confirmed distribution. Quick recession lasted only 2 months but was severe.
2022 Bear Market
S&P 500: -25% decline, Tech down 33%
Patterns: Rising wedge failure in Jan 2022. Death cross confirmation. Multiple failed rally attempts (bearish harami patterns). NASDAQ showed evening star at Nov 2021 peak. Near recession but avoided by Federal Reserve action.
Multi-Month Patterns Signaling Recessions
Distribution Phase
3-6 months of topping action with multiple small-body candles and long upper shadows. Smart money exits positions.
Failed Rally Pattern
Multiple attempts to break resistance fail. Each bounce weaker than the last. Classic sign of bear market beginning.
Volatility Spike Pattern
Large candles with long shadows in both directions. Panic selling followed by relief rallies that fail quickly.
Bitcoin & Crypto Market Crash Patterns
Cryptocurrency markets exhibit extreme versions of traditional patterns due to 24/7 trading, high leverage, and retail-heavy participation. Understanding these patterns is crucial for managing risk in volatile assets.
📉2021-2022 Bitcoin Crash (-77%)
From $69K (Nov 2021) to $15.5K (Nov 2022)
⚡2025 Current Pattern Analysis
Observing for similar warning signs on longer timeframes
Protective Action Plan When Patterns Appear
For Long-Term Investors:
For Active Traders:
⚠️ Important Disclaimer: No pattern guarantees a crash or recession. Markets can remain irrational longer than you can remain solvent. These patterns should be combined with fundamental analysis (unemployment data, Fed policy, corporate earnings, yield curve inversions) and proper risk management. Always maintain stop losses and never risk more than 1-2% of portfolio per trade.
Volume Confirmation
Patterns are more reliable when accompanied by above-average volume. High volume on reversal candles shows strong conviction from market participants.
Support & Resistance
Candlestick patterns at key support/resistance levels have significantly higher success rates. Always combine with technical levels for best results.
Wait for Confirmation
Don't rush into trades based on a single candle. Wait for the next candle to confirm the pattern direction before entering positions.
Risk Management
Always use stop losses based on pattern structure. For reversal patterns, place stops beyond the pattern's high or low with proper risk/reward ratio.