There are many profitable candlestick patterns out there. I am sure there are also many websites, forums that discuss about this. No indicators needed and should be there are no indicators attached to the chart for better view. Here are some profitable candlestick patterns you can recognize on your chart.
Suggested time frame is H4 or above. H1 or less are not recommended since there are many false signals.
1. Bullish candle breakout
Bullish candle breakout is just a name. Maybe it has it own name on another website. Name is only a name for me. It does not really matter. The most important thing is the pattern.
Bullish candle breakout occurs when a bullish candle is broken by a bearish candle. First, we have to wait until a bullish candle is fully formed. Then, we wait on the next candle to appear. When the next candle move down and break the bullish candle, we go short and the target should be as big as the bullish candle. Put the stop loss above the bullish candle.
Please note that breakout must happen on the next candle after a bullish candle is formed. If it not broken by the next candle. We do not enter the trade.
2. Bearish candle breakout
Bearish candle breakout is the opposite of the Bullish candle breakout. This pattern happened when a bearish candle is broken by a bullish momentum. Please note that the breakout must happened on the next candle. If the next candle does not break the bearish candle, we do not enter the trade using this pattern.
To trade Bearish candle breakout, simply put a pending order or buy manually when the next bar/candle break the bearish candle. Target and stop loss ratio should be 1:1.
3. Bullish Engulfing pattern
I do love this pattern. Bullish Engulfing pattern is similar to those above. On Bullish Engulfing pattern, the second bar is containing the first bar. In other word, the high and low of the first bar is inside the high and low of the second bar. Here is the example
To trade Bullish Engulfing is just the same as the bearish breakout pattern above. Place order few pips above the bearish candle. The idea is when the price break the bearish candle, it will continue to move up. Target ratio should be minimum 1:1. Don’t forget to put the stop loss below the bearish candle. I usually put 10 pips below it.
4. Bearish Engulfing pattern
Bearish Engulfing pattern is the opposite of the Bullish Engulfing pattern. It occur when a bullish candle is inside a bearish candle.
Place a SELL order below the bullish candle. Minimum profit-loss ratio is 1:1. You can also trail your profit if you want. Don’t forget to place the stop loss above the highest point of the Bearish Engulfing pattern.
Those are my favorite candlestick pattern which are profitable. BUT, we still need to protect our account. Forex is super volatile market which cannot be predicted. We have to put stop loss to protect our account.