Candlestick Patterns Identified (updated 3/11/15)

The Candlestick Patterns Identified indicator automatically detects and labels 15 distinct candlestick formations to help traders identify potential market reversals and trend continuations. It streamlines technical analysis by highlighting complex patterns across various timeframes, allowing for more efficient chart monitoring.

Usage

The indicator identifies a wide range of bullish, bearish, and neutral patterns. Users can utilize these signals to confirm entries or exits based on established price action strategies.

To prevent chart clutter, specific patterns are represented with shorthand labels:

• H: Hammer
• IH: Inverted Hammer

The script is effective across all timeframes, though certain patterns like the Piercing Line, Bullish Belt, and Kickers are traditionally more reliable on daily charts. Each pattern detection can be toggled on or off within the settings to customize the workspace according to the user's trading style.

Details

The script utilizes specific price action logic to define each formation. For example, the Doji logic uses a percentage-based threshold (Doji Size) to determine if the body is sufficiently small relative to the total range.

Patterns such as the Bearish/Bullish Harami and Engulfing formations incorporate a trend filter ("Trend in Bars") to ensure the signal appears within a relevant context. This filter evaluates the price movement over a specified lookback period to confirm the preceding trend before a signal is printed. The script has been updated to Pine Script v6, featuring optimized alert conditions for every identified pattern.

Settings

• Trend in Bars: Sets the number of preceding bars used to determine the trend direction required for certain patterns to trigger.
• Doji size: Adjusts the sensitivity for Doji detection by defining the maximum allowed size of the candle body relative to its wick.
• Bullish Arrow Color: Sets the color for bullish signal shapes.
• Bearish Arrow Color: Sets the color for bearish signal shapes.
• Other (i.e. Doji) Symbol Color: Defines the color for neutral or transitional symbols like Dojis and Hammers.
• Bullish/Bearish Text Color: Customizes the label text colors for better visibility against different chart backgrounds.

FAQ

Which candlestick patterns are included in this tool? The tool identifies Doji, Evening Star, Morning Star, Shooting Star, Hammer, Inverted Hammer, Bearish Harami, Bullish Harami, Bearish Engulfing, Bullish Engulfing, Piercing Line, Bullish Belt, Bullish Kicker, Bearish Kicker, Hanging Man, and Dark Cloud Cover.

Can I set up notifications for specific patterns? Yes, the script includes alert functionality for every pattern. You can create alerts for individual formations or general detection signals via the TradingView alert menu.

How do I get access to Candlestick Patterns Identified? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.