The Bullish and Bearish Candle Strategy is a powerful, no-indicator trading method that helps you trade confidently across stocks, forex, crypto, and more. If you’re tired of messy charts and second-guessing entries, this strategy simplifies your decision-making using nothing but price action
What Makes This Strategy Different?
- Pure Price Action – No need for moving averages or oscillators.
- Clear Daily Bias – You know whether to look for buys or sells before the market opens.
- Quick Decisions – No waiting around; trades are often done early in the session.
Step 1: Do Your Daily Candle Homework
Before the market opens, take a few minutes to check the daily chart of your favorite stocks or instruments.
What to look for:
- Bullish Candle: Large body, small or no wick on top.
- Bearish Candle: Big body, short top wick.
Avoid candles with long upper or lower wicks—they show indecision and can lead to choppy trades.
What to mark:
- For bullish candles: Mark the high.
- For bearish candles: Mark the low.
These become your breakout zones for the next trading session.
Step 2: Define Your Directional Bias
This part is simple:
- If yesterday’s candle was bullish → look for buy setups only.
- If it was bearish → look for sell setups only.
This prevents you from trading against the trend and keeps things clean.
Step 3: Stock & Index Strategy – Use the Gap and Breakout Setup
Buy Setup (When Yesterday’s Candle Was Bullish)
Option A: Flat or Slight Gap-Down (Less than 0.50%)
- Entry: Buy when the price breaks above yesterday’s high.
- Stop Loss: Below the breakout candle or nearest support.
- Target: At least 1:2 risk-to-reward ratio.
Option B: Gap-Down With a Red 1-Minute Candle
- Wait for a red candle to form on the 1-minute chart.
- Entry: Buy when the price breaks above that red candle’s high.
- Stop Loss: Below the low of that candle.
- Target: 1:2 minimum.
Sell Setup (When Yesterday’s Candle Was Bearish)
Option A: Flat or Slight Gap-Up (Under 0.50%)
- Entry: Sell when the price breaks below yesterday’s low.
- Stop Loss: Above the breakout candle.
- Target: 1:2 or better.
Option B: Gap-Up With a Green 1-Minute Candle
- Wait for a green candle to appear on the 1-minute chart.
- Entry: Sell when the price breaks that candle’s low.
- Stop Loss: Above the high of the green candle.
- Target: 1:2 minimum.
Step 4: For Forex, Crypto, and Metals – Use the 1-Hour Chart Confirmation
Since there’s no “gap” in 24-hour markets like forex and crypto, you’ll need to rely on intraday confirmation.
Buy Setup (After a Bullish Daily Candle)
- On the 1-hour chart, wait for a red candle to form.
- Entry: Buy when price breaks above that red candle’s high.
- Stop Loss: Below that red candle or the recent swing low.
- Target: 1:2 or more.
Sell Setup (After a Bearish Daily Candle)
- On the 1-hour chart, wait for a green candle to form.
- Entry: Sell when price breaks below that candle’s low.
- Stop Loss: Above that green candle or swing high.
- Target: 1:2 or more.
Pro Tip: Master the Art of Holding
Getting in is the easy part—holding your trade is where most traders struggle.
Once your trade is in profit, consider trailing your stop to protect gains and let winners run.
If you want to build more confidence in holding trades longer, practice journaling your trades and tracking your emotions during the hold phase.
Final Thoughts
The Bullish or Bearish Candle Strategy is great for anyone who wants a clean, repeatable approach to trading. There’s no need to clutter your screen with indicators—just read the candles and trust the process.
Ready to try it?
Start with one or two setups a day, manage your risk, and build consistency over time. You’ll be surprised how powerful a simple strategy can be.