Cheat sheet

Candlestick Invalidation

Need a quick refresher on when a candlestick pattern has failed? Find the key invalidation level for each pattern below.

Pattern icon	Pattern	Invalidated by	Open guide
	Doji	A close below the low
	Inverted Hammer	A close below the Inverted Hammer's low
	Hammer	A close below the Hammer's low
	Spinning Top	A close below the low
	Bullish Harami	A close below the mother candle's low
	Bullish Engulfing	A close below the engulfing candle's low
	Dragonfly Doji	A close below the Dragonfly's low
	Piercing Pattern	A close below Candle 2's low — the gap-down low
	Morning Star	A close below the formation's low
	Three White Soldiers	A close below the first soldier's low
	Tweezer Bottom	A close below the matched low
	Long-Legged Doji	A close below the low
	Three Inside Up	A close below the formation's low
	Bullish Abandoned Baby	A close below the doji's low
	Bullish Belt Hold	A close below the belt hold's low, which is also its open
	High Wave	A close below the low
	Three Outside Up	A close below the engulfing candle's low
	Homing Pigeon	A close below the mother candle's low
	Matching Low	A close below the matched closing level
	Bullish Doji Star	A close below the pattern's lowest low
	Bullish Tri Star	A close below the middle doji's low
	Bullish Kicking	A close below the gap's bottom (Candle 1's open) — an intraday dip does not count
	Bullish Tasuki Line	A close below the pattern's low
	Last Engulfing Bottom	A close below the bottom of the two candles — the decline simply resumes
	Takuri Line	A close below the takuri line's low
	Ladder Bottom	A close below candle 4's low
	Bullish Counterattack Lines	A close below the pattern's low
	Unique Three-River Bottom	A close below candle 2's low — the low it just defended
	Bullish Breakaway	A close below the pattern's lowest low
	Three Stars in the South	A close below candle 1's low
	Concealing Baby Swallow	A close below candle 4's low
	Four-Price Doji	Nothing to void — normal range returning shows it was a thin session

How candlestick invalidation works

Every candlestick pattern has a price that proves it wrong. It is the extreme the pattern was supposed to hold: for a bullish pattern that is its low, and for a bearish one its high. A close back through that level means the setup failed and the trade is over, no matter how the chart looks — for a continuation pattern built on a gap, that level is the gap itself, and filling it is the failure. A pattern can also fail quietly: if the confirming close never arrives, there was never a signal to act on.

FAQ

What does invalidation mean for a candlestick pattern?

Invalidation is the point at which a pattern has measurably failed and the trade is off. Every pattern carries a price level that proves it wrong — for bullish reversals, the pattern's low. A close beyond that level means the move the pattern predicted did not happen: the original reason for the trade no longer exists, and staying in is hoping, not trading.

Where should I place my stop on a candlestick pattern?

At the pattern's extreme. For single-candle patterns, below the candle's low (or above the high for a bearish read). For multi-candle patterns, the anchor is the formation: the engulfing candle's low, the Harami's mother-candle low, the Piercing Pattern's gap-down low, the Morning Star's formation low, and the first soldier's low for Three White Soldiers. Each row of this cheat sheet names the exact level.

Can a candlestick pattern fail without hitting the stop?

Yes — by never confirming. A pattern that prints and then drifts sideways without the confirming close never becomes a signal, so there is nothing to trade. That is not the same as invalidation: the stop level proves the pattern wrong, while a missing confirmation means the pattern never proved itself right. Both end the setup.

Does weak volume invalidate a candlestick pattern by itself?

Weak volume rarely kills a pattern on its own, but it weakens every other signal. A Hammer on light volume is an empty wick; a Dragonfly Doji on thin volume often means price drifted back rather than being defended. Use volume as a filter on conviction, not as the invalidation line itself.