Predicting the next up or down candle is a strategy many of you learn. Especially if you are trading Binary Options this is even more important. Currently, there is no effective method to find this job. I have also tried searching on the internet but have not found ... any secret.

After a while of searching, I found an article on Forex Factory about candlestick pattern 212, a candlestick pattern whose author ReyesWhite said that it is possible to predict the color of the next candle, that is, the next candle. is increase or decrease. This pattern predicts a 70% chance of the next candle.

The structure of predicting the 6th candle is to have a cluster of 5 candles in front of it and these 5 candles must be in the correct order as follows.
  • The first two consecutive candles must be in the same direction
  • The third candlestick must be the opposite of the first 2 candles
  • The 4th and 5th candles should be continued in the same direction as the first 2 candles
After this cluster of 5 candles is completed, the 6th candle is inferred to be in the same direction as candle 3

This pattern is recommended by the author on the time frames H4, Date (Daily), Week (Monthly), Month (Monthly)

Image: 212 pattern predicts the next candle

According to the above illustration (taken from the original article), candle 1-2 increases continuously, candlestick 3 decreases, candlestick 4-5 increases continuously => completed pattern 212 => candle 6 decreases.

According to the author, you should always pay attention to the candle before the first candle. Here are a few examples of incorrect setup
  • Followed by candlestick patterns 212 predicting the next correct bullish or bearish candle
  • Use the 50 EMA and 200 EMA to filter the signals (I think only look for a 212 bullish pattern if the 50 EMA is above 200 and only look for a bearish 212 pattern if the 50 EMA is below 200)
Indicator and EA code are available for the 212 pattern

Community strength on Trading Factory has been shown when someone has coded this model as an indicator, even an EA to backtest, with results running on eurusd in 2013 profitable.
The 212 patterns are only used to predict the 6th candle, not to predict the candles after the 6th day.

This result of the EA 212_pattern_EA.mql is attached below
There are some EA (Expert Advisors - automatic trading software also known as a trading bot) written by the Trading Factory community in this article.

Indicator named: _212_pattern.mq4, the other one is EA

Try to install the pattern indicator 212 on your MT4 and open it on eurusd H1 chart. The result, surprisingly, is true of 6/7 nearest patterns

Switch to the daily chart also of eurusd, have the correct rate is 4/10.

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