Bullish Stick Sandwich & Confirmation Candlestick Pattern

In the previous article, we discussed and provided information about the "Bullish Homing Pigeon" candlestick pattern which has a medium accuracy level. Later in this article, we come back to you to share strategies and will discuss how we trade forex using signals from the "Bullish Stick Sandwich" candlestick pattern analysis. This "Bullish Stick Sandwich" candlestick pattern has only a medium level of accuracy, in this case, confirmation is very important. Confirmation that means we are allowed to start buying shares.

Just like before, the "Bullish Stick Sandwich" candlestick pattern is known as a buy signal which is a sign that a trend (Bearish) has ended and a trend (Bullish) is starting. The reversal point of this direction is the most appropriate time for us to buy stock prices. So that we can better understand the information from a "Bullish Stick Sandwich" candlestick pattern, let's look at the following picture below:

Bullish Stick Sandwich Candlestick Pattern Information

Bullish Stick Sandwich Candlestick Pattern Information

As we can see in the picture above, we can see that the "Bullish Stick Sandwich" candlestick pattern is formed by 3 candlesticks, 2 red candlesticks with long trunks, and 1 green candlestick with long trunks. To simplify the analysis, as usual, we will assume that the candlestick pattern is formed daily. However, you also need to remember that this candlestick pattern is formed after a long (Bearish) trend.

Let's discuss the candlestick pattern image above. On the first day, we see a red candlestick that has a long bar. This means telling us that the Bearish candle is still continuing its dominance. We predict that for tomorrow, the bearish candle will still dominate the price of a stock. However, this prediction proved wrong. On the second day, what happened was the formation of a green candlestick that had a long stem. This means telling us there is very strong resistance from the Bullish candle squad.

Because it is so strong, the Bearish candle is pushed back far. If we see this, most likely, a bullish candle will dominate the stock price the next day. This prediction seems to be correct at the beginning of the third day's price opening. The Bullish candle managed to push the Bearish candle back even further than before. However, the Bearish candle managed to find its strength again.

Bearish candlesticks can make a very strong counterattack and push the Bullish candle back to its starting point. This is a bad sign showing. We can respond that the Bearish candle still has the power to dominate the stock price again. Fortunately, the Bullish candle's resistance at the starting point is very strong. The proof is, the Bearish candle squad, which is at its strongest, failed to push further forward.

So far, we can conclude that it is very unlikely that the Bullish candle will be hit back at this point. What exists is that the Bearish candle will start to exhaust so that in the end, the Bullish candle will dominate the price. However, the chance of the Bullish candle's resistance being broken is still there. So, this is why I said earlier that in using signal analysis of the "Bullish Stick Sandwich" candlestick pattern it is very important to wait for confirmation. The confirmation, in this case, is the Bullish candle is stronger than the Bears candle.

To better understand how this confirmation, let's look at the image below:

Confirmation of the Bullish Stick Sandwich Candlestick Pattern

Confirmation of Bullish Stick Sandwich

From the image above we have added a green candlestick that has a long bar and a black confirmation line. This tells us that in the end, the strength of the Bullish candle has been really stronger when compared to the Bearish candle. It has been confirmed that the Bullish candle has dominated the price of a stock. The share price will continue to rise, of course, it is the most appropriate time for us to buy shares.