Recognizing Thirteen Candlestick Patterns with Chart Labels and Arrows

Summary

This indicator identifies thirteen common candlestick formations and marks them on a chart with labels and, for many patterns, directional arrows. The listed formations include doji, morning and evening stars, shooting star, hammer variants, harami, engulfing patterns, piercing line, hanging man, and dark cloud cover. The document describes rule-based checks using relationships among open, high, low, and close prices; some rules also use recent bars or average true range to position annotations. It notes that the individual pattern conditions can be reused in indicators, strategies, or screeners, and that label colors can be adjusted.

The material is a pattern-recognition implementation, not a complete trading strategy. It does not establish that the formations predict returns, explain the market context in which they may be meaningful, or provide backtest evidence. Pattern definitions are encoded as specific thresholds and candle relationships, so results depend on those choices and the data timeframe. Users would need separate rules for confirmation, entries, exits, and risk management before using the signals in a systematic strategy.

Key ideas

• The indicator marks thirteen named candlestick patterns using price-bar relationships.
• Many patterns receive directional arrows, while some receive text labels only.
• Recent bars and average true range are used in some pattern rules or annotation placement.
• The code can provide reusable conditions for other indicators, screeners, or strategies.
• Pattern recognition alone does not establish predictive value or define trade and risk rules.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.