Candle Confirmation Pattern by Yashar Seyyedin

Understanding the Candle Confirmation Pattern

• The Candle Confirmation Pattern, created by Yashar Seyyedin, is primarily a three-candle setup that aims to confirm market momentum.
• This method simplifies traditional candlestick pattern analysis into easy-to-follow rules.
• The basic setup involves observing three consecutive candles.

Rules for Long (Buy) Entry

• Rule 1: The closing price of the second candle should be greater than the high of the first candle: Close[bar2] > High[bar1].
• Rule 2: The high of the third candle must be greater than the high of the second candle: High[bar3] > High[bar2].
• These rules indicate bullish momentum and possible entry points. 📈

Interpreting Momentum

• The Candle Confirmation Pattern significantly detects upward momentum, implying that the market may be shifting toward a bullish phase.
• If confirmed at the end of a downtrend, it is a signal not to be ignored, offering potential trading opportunities.

Usage and Limitations

• This pattern can generate many signals due to its simple rules, often leading to false entries if used alone.
• It is recommended to pair this method with additional tools or visual confirmation for better accuracy.
• Traders should be wary as it can cover numerous existing candle patterns, demanding careful filtering.🧐

Non-Repainting Characteristics

• One key feature of this indicator is that it does not repaint, meaning once a signal is confirmed, it remains valid.
• Traders do not have to wait for candle closure to act on signals, making it less stressful and more responsive in fast-moving markets.

Integration with Other Tools

• This pattern can be enhanced when combined with other trading indicators or with the naked-eye analysis of price action.
• Utilizing additional indicators like moving averages or oscillators can provide the necessary confirmation to validate signals generated by the Candle Confirmation Pattern.