Everything that you need to know about the High Wave candlestick pattern is here.
Today you’ll learn:
The High Wave is a Japanese candlestick pattern.
It’s an indecision candle, meaning that when it appears, the price is not showing the intention to move in any particular direction.
For this reason, when you see them, it’s a good practice to stay away and wait for clear price action showing a move starting in some direction.
The High Wave candlestick pattern is formed by one single candle.
Here’s how to identify the High Wave candlestick pattern:
It looks like this on your charts:
The High Wave candlestick pattern may appear a little different on your charts.
The body may be green or red, the only requirement is that it’s small.
Here’s what it may look like on your charts:
Don’t confuse the High Wave candle with other very similar: the Doji candle and the Spinning Top candle.
The only difference between them is the size of the wicks. The Doji candle is the one that has the smaller wicks. The High Wave has very big wicks. The Spinning Top is in the middle.
The High Wave candle is an indecision candle, meaning that the market is not showing anything about where it wants to go.
For this reason, while the market is undecided, we stay away and wait for at least one more candle, or pattern to appear.
Once we get more information, we can combine bullish or bearish candlestick patterns with technical indicators and trade with more confidence.
Now I want to hear from you.
Do you use the High Wave candlestick pattern?
Let me know in the comments below.
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