In basic Trading books, you will learn about more than 20 candlestick patterns including bullish reversal candlestick patterns - bearish reversal candlestick patterns and 2-3 continuation candlestick patterns.

In fact, you don't need to learn how to apply all of those candlestick patterns if you understand the general rule of why they work. And then, there are only 2 candlestick patterns left for you to apply to trade the market: pinbar and engulfing.

The main reason why you only need these 2 candlestick patterns is because they both tell the same story; The market is having a sharp reversal during that candlestick pattern.

For example, when you see a bearish pinbar candle in the H1 frame, it can simply be understood that Traders who entered buy orders during the time the candlestick formed were converted from profit to loss. They were forced to exit the order to preserve their account (or because of the stop loss because the price hit the stop loss), which made the selling pressure stronger and pushed the price down to near the low of the candle and formed a pinbar candle. 

Although this explanation is not exhaustive, you can apply them to a lot of different candlestick patterns.

Similar to the engulfing candle, it also announces a sudden reversal in the time the candlestick pattern forms but the time period is longer than the pinbar (occurs on 2 candles). And if you know the rule of candle combination, you will also know that the engulfing candle is actually a pinbar candle, but it is split in two. See the picture below to understand more:


With other candlestick patterns, you can use the candle combination rule to explain

Example using the association rule to explain the Morning Star or Morning Doji Star candlestick pattern.


After implementing the association rule, you understand that the Morning Star is an extension of the bullish pinbar pattern.

Or with the Dark Cloud Cover candlestick pattern, which is also an extension of a bearish pinbar.

However, using the association rule does not mean that you will not use the basic candlestick patterns. In many cases, the pinbar and engulfing candlestick pattern alone is not enough to describe all market reversals, then you will need names like Dark Cloud Cover, Doji, Morning Star... Knowledge of candlestick patterns will help you quickly detect market reversal signals, but only when you understand the law behind the reversal of candlestick patterns is from the change in buying and selling pressure, the candlestick pattern will doesn't matter anymore.

The problem only appears when there are patterns that are not important but still used by Traders when trading, for example Harami candlestick pattern.


Harami is a candlestick pattern in the form of a small real body surrounded by a previous large body candle. Harami is a reversal candlestick pattern, but if you use the combination of candlestick rules, you will find that it is a bullish candlestick pattern (if it is a bearish harami as shown on the chart).

Candlestick patterns like Harami do not notify you of reversal signals because they do not have a significant change in the buying and selling pressure in the market. With this candlestick pattern, the small candle next to it means that no Trader is losing money or the number of losers is still not enough to make a 'difference' in the market. There will be a possibility of a high reversal with this candlestick pattern.

Many candlestick patterns in trading books are similar to Harami. There is no single candlestick pattern that explains to the trader why the candlestick pattern is formed or how the traders trade in those patterns. Many manuals for trading candlestick patterns with trading rules are easy to make Traders make mistakes when trading.

Hopefully after reading this article, you understand why you don't need to use so many candlestick patterns except for pinbar and engulfing.