Candlestick Pattern Scanner

Japanese candlestick patterns are shapes made by one, two or three bars: where a bar opened, closed, and how far it reached. Traders read them as signs of who won that bar, buyers or sellers.

A candlestick screener checks every stock's latest bar for those shapes. Trade Ideas does it live: the alert fires as each bar closes, since a candle is not finished until then.

For how pattern recognition works behind the scenes, see candlestick pattern recognition.

A doji is a bar where the open and close are nearly the same. It says buyers and sellers were even for that bar. 5 Minute Doji (DOJ5), 15 Minute Doji (DOJ15) and 60 Minute Doji (DOJ60) fire it on 5, 15 and 60 minute bars.

Traders look for doji after a run, as a sign the run is tiring. There is no separate dragonfly or gravestone alert to turn on, but the alert description can name the type: the real capture on this page shows “5 minute Gravestone Doji.”

A hammer has a small body near the top and a long lower tail. Sellers pushed it down, buyers pushed it back. 5 Minute Hammer (HMR5) and 15 Minute Hammer (HMR15) fire it live. The same shape after a run up is a hanging man, 5 Minute Hanging Man (HGM5).

A bullish engulfing bar is a green body that fully covers the prior red body. 5 Minute Bullish Engulfing (NGU5) fires it; 5 Minute Bearish Engulfing (NGD5) fires the bearish version. Engulfing alerts come in 5, 10, 15 and 30 minute versions.

A wide range bar is much bigger than the bars around it, often the start of a move. 5 Minute Wide Range Bar (WRB5) fires it on 5 minute bars; 2 and 15 minute versions exist too.

The 1-2-3 continuation is a tall bar, a small pause bar, then a break past both. 5 Minute 1-2-3 Continuation Buy Signal (C1U_5) and 5 Minute 1-2-3 Continuation Sell Signal (C1D_5) fire the buy and sell signals.

1. In TI Pro, open a Streaming Alerts window.
2. Turn on the candles you trade on one bar length, like Hammer and Bullish Engulfing on 15 minutes.
3. Add Relative Volume, Price and Spread filters.
4. Save and turn on sound.

Candlestick charts started with rice traders in Japan centuries ago and came to Western traders in the late 1900s. The names, doji, hammer, engulfing, come from that tradition.

Each candle shows four prices: open, high, low and close. The body is the open-to-close range; the tails, or wicks, show how far price reached past it. Patterns are named shapes of one or more of those candles.

Doji, hammer, hanging man, wide range bar and the tails are single-candle patterns: the last bar alone has the shape.

Engulfing, piercing and dark cloud cover compare the last bar to the one before. The bar reversals look at a run of bars. The 1-2-3 continuation uses three.

A 2 minute hammer is a tiny event. A 60 minute hammer reflects an hour of trading. Most candle alerts come in several lengths so you can match your chart.

Day traders often use 5 and 15 minutes. Traders holding into the afternoon use 30 and 60.

A candle pattern means more at a level that matters. A hammer at VWAP, at yesterday's low, or at a 62% Fibonacci level gets more attention. Combine the candle alerts with Distance From VWAP 1 (VWAP) or the Fibonacci scanner.

5 Minute Green Bar Reversal (GBR5) fires on a green bar after a string of red bars; 5 Minute Red Bar Reversal (RBR5) on a red bar after green bars. With 5 Minute Bottoming Tail (BT5) and 5 Minute Hammer (HMR5), these are the alerts traders use for intraday reversal signals.

A screener runs your candle rule on a list when you ask, often on daily bars. The alerts here fire as each intraday bar closes, on every US stock.

1. A stock sells off into yesterday's low.
2. The 15 minute bar dips under it, then closes near its high with a long lower tail.
3. HMR15 fires as the bar closes.
4. A trader using this setup might buy over the hammer's high with a stop under its low.

The capture in the proof section is real. At 10:00:00 a.m. ET, the 5 Minute Doji (DOJ5) alert fired on four stocks as the 5 minute bar closed. ADMA was at $4.43, down 2.3%, with Relative Volume of 1.15. WTI and DADA both printed a "5 minute Gravestone Doji," a doji with a long upper wick and the close near the low. ALTO printed a plain doji at $2.67.

Notice that all four fired at the same second. Candle alerts fire when the bar closes, so on the 5 minute chart they land at :00, :05, :10 and so on. If you want to see a candle form before it closes, the bar-close alerts are not for you; momentum alerts like Running Up Now fire mid-bar.

The description line tells you which doji it was. A gravestone after a run up reads differently from a plain doji in a range, and you see that in the window without opening the chart.

The longer the bar, the fewer alerts and the more each one means. Many traders pick one or two bar lengths and stick with them.

Bullish reversal at the low

Bearish reversal at the high

Indecision

A hammer in the middle of nowhere means little. A hammer on the 200 day average, at yesterday’s low, or on a Fibonacci level is a sign buyers stepped in where they were expected. Add Position in Previous Day's Range (RPD) with a max of 10 to see only candles near yesterday’s low, or Change From 200 Day SMA (%) (MA200P) between -1 and 1 to see candles at the 200 day.

• They do not label every named pattern in the textbooks. Morning stars, three white soldiers and harami patterns are not separate alerts.
• They do not read the daily candle in real time. The longest candle alerts use 60 minute bars.
• They do not tell you which way the next bar goes. A candle is one piece of evidence.

Each link goes to the 15 minute version’s help page; the other bar lengths are listed there.

• Volume. A reversal candle on Relative Volume (RV) above 1.5 shows real buyers or sellers took part.
• Location. Candles at VWAP, the prior day’s low or high, or a moving average carry more weight. Distance From VWAP 1 (VWAP) between -0.5 and 0.5 keeps only candles near VWAP.
• The next bar. Many traders wait for the next bar to break the candle’s high (for bullish) or low (for bearish) before acting.
• Trend context. A hammer in a long downtrend is a first sign, not a turn. Consecutive Candles (15 min) (Up15), Consecutive Candles, shows how many bars in a row went one way before it.

Hammer at support window

Add the Crossed Below Support alert in a second window to see the stocks that did not hold.

Candle alerts need regular bars, so most traders run them from the open on. Premarket bars can be thin, with long gaps between trades, and a single trade can make a misleading candle.

Doji (15 Minute Doji). Open and close at about the same price. Buyers and sellers are even for that bar. Confirmation: A doji means more after a run. Wait for the next bar to break the doji’s high or low; that break shows which side won.

Hammer (15 Minute Hammer). A long lower tail and a close near the high, after a drop. Sellers pushed it down; buyers took it back. Confirmation: Best at a known level. Many traders want the next bar to trade above the hammer’s high before buying, with the stop under the tail.

Hanging man (15 Minute Hanging Man). The same shape as a hammer, but after a rise. It warns that sellers showed up near the high. Confirmation: Weak on its own. Traders look for a close below the hanging man’s body on the next bar.

Engulfing (15 Minute Bullish Engulfing). A bar whose body covers the whole body of the bar before it, in the other color. Confirmation: Stronger on above-normal volume and after a clear move the other way. The bearish version is the Bearish Engulfing alert.

Piercing pattern and dark cloud cover (15 Minute Piercing Pattern). Two-bar turns. A piercing pattern opens low and closes past the middle of the prior red bar; dark cloud cover is the bearish mirror. Confirmation: Look for them at the end of a move, not in a range. The deeper the second bar closes into the first, the stronger the read.

Bottoming and topping tails (15 Minute Bottoming Tail). A long tail on one end of the bar, showing a level was tested and rejected. Confirmation: A tail that tests yesterday’s low, VWAP or a round number tells you more than one in open space.

Green and red bar reversals (15 Minute Green Bar Reversal). A green bar after a run of red bars, or the reverse. Confirmation: The simplest turn signal. Traders use it as the trigger once another reason, such as a Fib level, already put the stock on watch.

Narrow range and NR7 (NR7 (15 Minute)). A bar with a smaller range than the bars before it. The market is pausing. Confirmation: Not a direction signal. It sets up a break, so many traders pair it with consolidation breakout alerts.

Wide range bar (15 Minute Wide Range Bar). A bar much bigger than normal for the stock. Confirmation: Shows urgency. A wide range bar that closes near its high, on volume, is a strong push; one with a long tail may be exhaustion.

1-2-3 continuation (15 Minute 1-2-3 Continuation Buy Signal). A strong bar, a short pause, then a move past the first bar. The trend resumes. Confirmation: The setup alert fires first and the signal alert when the pattern completes. Many traders wait for the signal.

Volume shows whether a candle had real participation. Volume (15 min) (Vol15), the volume of the last 15 minutes, lets you set a floor so 15 minute candles on a few hundred shares do not show up. Relative volume does the same job across stocks of different sizes.

One candle is one bar. It is a hint, not a forecast.

Short bar lengths fire a lot. Start with 15 minutes or more.

Test your rules in a simulated account first.