Candlestick Mastery · Module 06 of 15
Two-Candle Patterns
Context is key — patterns form in relation. Two candles together say more than either alone.
When one candle answers another
Some of the most reliable signals need two candles: the second reacting to the first. The relationship between them is the message.
- Bullish / Bearish Engulfing — a small candle completely swallowed by a large opposite one. Bullish engulfing: a small red candle overwhelmed by a large green — buyers seized control decisively. Bearish engulfing is the mirror. The larger and cleaner the engulfing candle, the stronger the signal.
- Piercing Line / Dark Cloud Cover — a two-candle partial reversal. Piercing Line: after a red candle, a green one closes back above the midpoint of the red — buyers recovering ground. Dark Cloud Cover is the bearish mirror: a red candle closing below the midpoint of the prior green.
- Tweezer Top / Bottom — two candles with matching highs (top) or matching lows (bottom). The market tested the same level twice and was rejected both times — a sign the level is holding and a reversal may follow.
In short
Engulfing = decisive takeover; Piercing/Dark Cloud = partial reversal; Tweezers = a level tested twice and held.