Treat a candlestick reversal as incomplete until %D confirms it

Read the candle as an incomplete hypothesis

Named candlestick patterns are multi-bar price shapes built from open, high, low, and close. They mark a testable reversal or indecision condition. In the illustrated workflow, that condition is not treated as complete on the candle alone.

The archive charts pair each named candle with the stochastic %D line. Editorial reading: treat the candle as an incomplete reversal hypothesis until the same bar also carries a %D extreme and, when a split is present, divergence between price direction and %D.

Meeting lines with a %D extreme

Meeting lines are a session that opens with a gap and closes unchanged. They are read as either unclear market direction or the end of a trend.

A meeting-lines session that coincides with a %D reading above 80 is treated as a potential reversal warning. The same meeting-lines shape also appears with %D below 20 in the illustrated sequences, where that low reading is used as oversold reversal context.

Hammer, hanging man, and shooting star

A hammer is a compact real body with a long lower shadow and little or no upper shadow. It is read as an attempt to form a base. In the illustrated sequences, hammers are paired with %D below 20 as oversold reversal context.

A hanging man has the same candle shape as a hammer, but it is interpreted at the end of an uptrend as leftover long exposure after a rally.

A shooting star has a compact body near the lows, a short lower shadow, and a long upper shadow. It is treated as bearish inside an uptrend, especially when %D is above 80.

Harami with a low %D and a price split

A harami is a two-session pattern whose later real body is smaller and contained inside a larger prior real body. A harami cross is a harami whose open and close are the same price.

One illustrated reversal is attributed to a harami appearing together with a %D reading below 20 and a split between %D and price. Editorial reading: that split is divergence. It is used to strengthen the candle-plus-oscillator reversal reading, not to replace the candle.

How the illustrated sequences pair %D

Across the illustrated sequences, %D below 20 is paired with hammers, meeting lines, and harami variants as oversold reversal context. %D above 80 is paired with meeting lines and shooting stars as overbought reversal context.

%D is the stochastic line used for those extremes. Editorial reading: the oscillator supplies overbought or oversold context for the candle hypothesis. It does not turn every named shape into a finished reversal on its own.

The doji star waits for the next session

A doji star is a doji that gaps away from a long candle. It is treated as a reversal only after the following session confirms.

Editorial reading: that next-session check is another reason not to treat a named candle as a finished reversal on the bar that first prints the shape.