Candlestick patterns are a key piece of chart analysis. They are not everything, though some will claim it, but they give key insights to the overall picture the chart is presenting to you.
The problem is there are many of them, often slight variations of the same thing. E.g. Shooting Star and Bearish Abandoned Baby. You have to study these patterns quite a bit, and you have to care about them enough to get the subtle differences sorted out so you can use them.
Image source: Wikipedia.org
I have primarily used candlesticks on my own charts for over a decade. I like them for how they visually represent prices and quickly show the contrast of the open, close and daily range. I studied how best to use them inside a trading system as confirmation of my existing signals. I was very happy when a Candlestick Patterns Cheat Sheet … (Read more)
It (the cheatsheet) is actually very useful. All the major candlesticks and patterns are repesented. Plastic coat it and drop it in your top desk drawer for quick reference. You’ll be pulling it out regularly.
Apart from that … Japanese candlesticks are just flat out fascinating.
The two most interesting candlesticks I find most revealing in actual trading are. 1) the very small bodied Spinning Tops, when arranged in a row of five or six that indicate a volatility squeeze preceding a Breakout.
And 2), the long exponential exhaustion candles that are by their nature unsustainable and indicate the end of the current leg, and a likely reversal. And often, an optimum take-profit point.
Candlesticks are awesome!