When it comes to technical analysis, we have to be honest—candlestick charts are not meant to be visually pleasing; they are tools used to find direction, anchor positions, and discover opportunities.

Traders who do their homework well can use candlesticks to precisely grasp the market pulse, entering when it’s time to go in, retreating when it’s time to pull back. The difference between entering and retreating is just that level of awareness.

**First Level: Clarify the Trend Direction**

The simplest judgment method—consecutive bullish candles, each closing higher than the last—is a standard uptrend. Your strategy is one word: follow. Conversely, if you see one bearish candle after another, with prices gradually declining, that’s a downtrend. Consider shorting only after a rebound appears.

Many people stumble here—acting before the trend is confirmed, or stubbornly fighting against the trend despite clear signals. The market loves opponents like that.

**Second Level: Pinpoint Key Levels**

Look at areas where prices repeatedly fall and then rebound—that zone is called support. When the price drops near support and a hammer or engulfing pattern appears, it’s a good time to buy low.

On the flip side, zones where prices repeatedly surge and then fall back are resistance levels. When prices approach resistance again, accompanied by volume expansion and signals like hanging man or doji, it’s time to short.

Position always outweighs pattern; grasp those key points, and your operations will be more stable.

**Third Level: Volume and Price Must Match**

Rising without volume? That’s likely fake. A genuine breakout must be supported by volume; otherwise, the rebound will quickly reverse.

During declines, increasing volume indicates bearish strength; but if volume diminishes during a decline, be cautious—the rebound might be near.

Market movements without volume support are gambling if you go all-in recklessly. The market will always teach you a lesson.

**Fourth Level: Use Patterns and Indicators for Confirmation**

Common bottom patterns include hammer, morning star, and bullish engulfing; these are relatively reliable signals. During strong phases, watch for formations like the “Three White Soldiers.”

As for technical indicators like moving average crossovers or MACD crossovers, they are auxiliary tools, not reasons to enter a trade independently. Confirm the main trend and specific patterns first; indicators are just the icing on the cake.

Finally, a reminder—stop-loss is mandatory.

Before entering a trade, think clearly about how to cut losses. Orders without stop-loss are like swimming without a life jacket; eventually, the market will swallow you.

It’s that simple: follow the trend, hold key levels, trade lightly to test, and strictly execute stop-loss. Master these basics, and even beginners can survive steadily in the market.