• By CFD Trading
• 2025-10-01 22:13

How to read candlesticks in Deriv Trading View

Introduction When you fire up Deriv’s Trading View charts, candlesticks aren’t just pretty bars—they’re a storytelling language about price, momentum, and mood. You’ll notice how a short body with a long wick can signal hesitation, while a strong, elongated body can hint at persistence. This article sheds light on how to read those candles across forex, stock, crypto, indices, options, and commodities, plus practical tips to keep risk in check as you test ideas in the real world.

What candlesticks reveal on Deriv Trading View

• Price action snapshot: each candle captures open, high, low, and close for a chosen interval, letting you see who pressed or pulled back during that period.
• Market psychology: color and size reflect buyer vs. seller energy. A green (or white) candle often shows buyers in control; a red (or black) candle hints at sellers taking the wheel.
• Context matters: candles gain meaning when you pair them with chart structure, trend direction, and nearby candles. A single hammer sounds convincing, but a string of them in a downtrend tells a different story.

Common patterns to recognize

• Doji: the open and close are very close, signaling indecision. A cluster of doji near support or resistance can foreshadow a breakout.
• Hammer and hanging man: long lower wick with a tiny body. In a downtrend, a hammer suggests potential reversal; in an uptrend, the opposite signals caution.
• Engulfing: the real body completely engulfs the prior candle’s body. A bullish engulfing after a dip can mark a shift in control; bearish engulfing after a rally can warn of exhaustion.
• Morning/Evening star: a three-candle pattern where a small-bodied candle sits between a larger opposing candle and a confirming candle—often a sign of trend pause or reversal. These patterns aren’t magic bullets, but they help you frame a bias and test it against other signals, like volume or moving averages on Deriv’s charts.

Practical steps to read on Deriv Trading View

• Set the right timeframe: start with a larger view (daily or 4-hour) to identify the trend, then zoom in to intraday candles for entries.
• Normalize the setup: pick a specific asset class and build a consistent checklist (trend direction, pattern, consolidation areas, breakout hints).
• Confirm with context: use a secondary indicator sparingly (e.g., a 20-period average or RSI) to confirm the candle’s message without crowding your view.
• Watch wick conclusions: long upper wick can signal rejection of higher prices; long lower wick may show rejection of lower prices. Look for confirmation in the next candle.
• Treat candles as a language, not a forecast: a single candle rarely guarantees a move. Look for sequences and how they align with your plan, including risk controls.

Why this matters for prop trading across assets

• Forex, stock, crypto, indices, options, and commodities all trade in patterns that candles can reveal. A disciplined reading habit helps you spot entries and exits faster, no matter the instrument.
• Across markets, candlesticks help you compare impulse versus restraint. When day-to-day liquidity shifts, candles provide a clean snapshot of who’s driving price at that moment.
• Real-world edge: combining candle awareness with plain risk rules—fixed risk per trade, defined stop losses, and clear profit targets—helps you stay in the game longer and refine your edge.

Reliability and risk considerations

• Don’t overfit to patterns. Use them as part of a simple, repeatable process; don’t chase every signal.
• Context is king. Always check recent news, earnings, or macro moves that could invalidate a candle’s message.
• Position sizing matters more than candle counts. A well-sized offsetting risk protects you when a trade moves against the candle’s implication.

DeFi landscape, challenges, and the road ahead

• Decentralized finance brings faster settlement and broader access, but it also introduces smart-contract risk, liquidity fragmentation, and evolving regulatory scrutiny. Candlestick reading remains valuable—yet you must factor on-chain signals and liquidity depth into your decisions.
• Emerging trends point to smarter automation: AI-assisted pattern recognition, more transparent data feeds, and contract-based trading on decentralized networks. Prop traders who blend candle-reading discipline with these tools stand to gain consistency.

Future trends: smart contracts, AI, and prop trading

• Smart contracts could automate predefined candle-based strategies, with guardrails to curb overtrading and risk creep.
• AI may enhance pattern recognition across multi-asset canvases, but human judgment stays essential for context, discipline, and adapting to regime changes.
• Prop trading continues to attract traders who want scalable setups and tested risk rules, where candlestick literacy remains a core skill for every asset class.

Promotional punchline Read the candle, ride the trend—own your setup with Deriv’s candlestick view.

If you’re testing these ideas tonight, start with a familiar pair, map a simple bias with a two-candle confirmation, and guard your risk. Candlesticks aren’t a crystal ball, but they’re a reliable compass when you pair them with discipline and a clear plan.