Understanding Candlesticks Lesson 07 Dark Cloud Cover Pattern

Dark Cloud Cover Candlestick Pattern Uses

When traders use the dark cloud cover pattern, the key to recognizing it lies in its location and confirmation. This pattern must appear after a significant uptrend, as it is recognized as a possible reversal signal, and the larger the gap it creates, the more significant the reversal signal becomes. This is only the basic concept, as a single dark cloud cover pattern on its own is not enough to confirm a trend change. Traders will look for other conditions to confirm this, which will involve moving averages, etc.

In this course, you learn all about recognising dark cloud cover patterns. You will be shown what they look like, how they form, and how you can identify potential trend reversals. You will learn about combining them with moving averages, support and resistance levels, oscillators like Relative Strength Index (RSI), all of which are used in conjunction with dark cloud cover patterns.

This course will teach you all of the patterns used. You will learn why the dark cloud cover pattern is more reliable when it forms in a strong uptrend and after an extended period of bullish price action, why the volume accompanying the pattern can provide important context and why a higher volume on the bearish candlestick suggests stronger selling pressure and increases the likelihood of a successful reversal. All of this and more, you’ll see how this pattern can be a powerful signal, most effective when combined with other technical analysis tools and indicators and a great tool for you to use on your Forex journey to wealth and future success.