How to Identify the Candlestick Pattern

f you are new to forex, candlestick is part of forex knowledge that you must learn to know. Being able to identify the candlestick pattern in forex can lead to extremely high profits. The first indication for someone that a currency may have profit capabilities are when it emerges. Computer software developed in recent years have given us the ability to track forex patterns better than ever before; and these patterns give investors the ability to track price movements.

Charting the forex has become radically more high-tech in the last decade; the recently developed software allows investors to customize forex graphs to their specifications. Instructing software to recognize the pattern makes locating high profit patterns easy.

Recognizing the Candlestick pattern alerts an investor that high profit patterns are emerging; the pattern can offer instant and correct analysis of many patterns; allowing an investor to utilize these profit indicators at the correct time; therefore allowing the investor to increase his or her bottom line. One of the most lucrative signals is the Scoop pattern.

The Scoop pattern is very efficient and it is easily recognized visually. The pattern is formed after a long period of flat trading. Flat trading is most commonly comprised of several days of minor, hesitant trading. After a documented flat trading period, the price starts to back down; this flat trading period is identified as the handle of the scoop.

This flat period is usually longer than what is considered normal; the flat period is so long it becomes boring and it may be the boredom that actually causes the movement to begin. However, after a few days wait, there are small buy signals emerging and the price slowly begins moving up, therefore creating the scoop. A large percentage of the time, when the price rebounds, it tends to continue in a strong upward pattern, therefore creating a candlestick pattern.