About the Candlestick Signals Indicator
The Candlestick Signals Indicator for MT4 is a specialized technical tool that automates the identification of classic price action patterns.
Instead of manually scanning every bar to find hammers, engulfing patterns, or shooting stars, this tool performs the analysis for you in real time.
It monitors price behavior and highlights specific formations that historically precede significant market moves.
This is particularly valuable for traders who rely on candlestick geometry to understand the sentiment of market participants at key price levels.
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Download the “candlesticks-signals.mq4” MT4 indicator
Key Features
- Scans all price bars automatically to identify a wide range of profitable candlestick patterns.
- Displays green and red arrows to provide immediate directional bias for buy and sell setups.
- Provides the specific entry price alongside the signal to assist with trade execution.
- Helps identify short-term reversals that often lead to larger trend shifts.
- Reduces the learning curve for beginners by highlighting patterns that are usually difficult to spot.
Indicator Chart
The Candlestick Signals Indicator places clear markers on the activity chart to highlight identified patterns.
A green buy arrow indicates a bullish formation has been detected, while a red sell arrow marks a bearish setup.
The indicator also displays the name of the pattern and the suggested entry price, allowing you to quickly assess the validity of the trade based on the surrounding market structure.
Guide to Trade with Candlestick Signals Indicator
Buy Rules
- Identify a green buy arrow appearing at the bottom of a price retracement.
- Confirm that the signal has formed at a significant support level or a demand zone.
- Ensure the overall trend is bullish to increase the probability of a successful outcome.
- Open a long position at the suggested price provided by the indicator.
Sell Rules
- Look for a red sell arrow to appear near a price peak or resistance level.
- Verify that the candlestick pattern suggests an exhaustion of buying pressure.
- Check that the broader market context aligns with a bearish outlook.
- Execute a short trade at the price level indicated by the red arrow.
Stop Loss
- Place the stop loss a few pips below the low of the signal candle for buy trades.
- Position the stop loss above the high of the signal candle for sell trades.
Take Profit
- Set the take profit at the next major technical level or previous swing extreme.
- Consider trailing the stop loss to lock in gains as the trade moves in your favor.
Candlestick Signals Indicator + Zwinner Trend MT4 Scalping Strategy
This MT4 scalping strategy merges the candlestick-based signals from Candlestick Signals MT4 with the trend confirmation from Zwinner Trend MT4 indicator.
The combination allows you to trade in the direction of the trend while entering on clear reversal or continuation points signaled by the candlestick arrows.
This strategy works best on M1 or M5 charts and is suitable for scalpers who prefer quick entries and exits with minimal analysis.
It is designed for traders who want clear mechanical rules but are willing to actively monitor the charts.
Buy Entry Rules
- Confirm that the Zwinner Trend histogram is green, indicating a bullish trend.
- Wait for a green arrow from Candlestick Signals and enter a buy at the next candle open.
- Place the stop loss a few pips below the most recent swing low or below the candle that triggered the arrow.
- Set take profit using a volatility-based rule, fixed pip target, or exit at trend reversal.
Sell Entry Rules
- Confirm that the Zwinner Trend histogram is red, indicating a bearish trend.
- Wait for a red arrow from Candlestick Signals and enter a sell at the next candle open.
- Place the stop loss a few pips above the most recent swing high or above the candle that triggered the arrow.
- Set take profit using a volatility-based rule, fixed pip target, or exit at trend reversal.
Take Profit Rules
- Volatility-based TP: Use the Average True Range (ATR 14) and set the take profit at 1.5 times ATR. This adjusts to current market conditions.
- Fixed pip target: on M1 or M5, aim for 8 to 20 pips depending on the pair and spread. Ensure the risk to reward ratio is at least 1 to 1.5.
- Trend exit: consider closing the trade when the Zwinner Trend changes color. This signals a possible trend shift or weakening, even if the take profit is not reached.
Advantages
- Combines trend confirmation and precise entry signals for higher probability trades.
- Dynamic take profit adapts to market volatility.
- Works on multiple timeframes, providing flexibility for scalping or short-term trading.
- Reduces false trades by only entering with trend confirmation.
Drawbacks
- Arrows may trigger frequently in sideways markets and cause false entries.
- Short timeframes are sensitive to spreads, slippage, and sudden volatility spikes.
- Requires active chart monitoring and quick execution.
- Trend reversals can hit stop loss quickly before momentum confirms a new direction.
- Scalping many trades can increase commission and spread costs.
Case Study 1 — USD/JPY, M5
The Zwinner Trend histogram turned green, signaling a bullish trend.
Candlestick Signals printed a green arrow.
Buy was entered at 149.50. Stop loss was placed at 149.40, 10 pips below the candle low.
ATR 14 was 6 pips. Take profit was set at 1.5 times ATR, which was 9 pips.
The trade reached take profit in 12 minutes for a net gain of 9 pips.
Case Study 2 — AUD/USD, M1
The Zwinner Trend histogram turned red, showing bearish momentum.
Candlestick Signals printed a red arrow.
Sell entry was placed at 0.6720. Stop loss was at 0.6730, 10 pips above the triggering candle high.
Fixed pip target was 15 pips.
The trade reached take profit at 0.6705 within 7 minutes for a net gain of 15 pips.
Strategy Tips
- Use only liquid major pairs with tight spreads for better scalping performance.
- Trade during active sessions, such as London or New York to capture strong momentum.
- Keep a trading journal to track arrows, histogram status, and results to improve consistency.
- Limit the number of trades per session to avoid overtrading.
- Skip trades during low volatility periods or around high-impact news events to reduce false signals.
- Backtest on a demo account to understand performance across different volatility conditions before using real funds.
Download Now
Download the “candlesticks-signals.mq4” Metatrader 4 indicator
FAQ
Which candlestick patterns does this indicator identify?
The Candlestick Signals Indicator is designed to find the most reliable reversal and continuation patterns.
This includes popular formations like Pin Bars, Engulfing candles, Morning Stars, and Dojis.
It focuses on these specific shapes because they represent a clear shift in the balance of power between buyers and sellers.
How should I use this indicator with the overall trend?
The best way to use this tool is as a trend-following entry trigger.
If the daily trend is up, you should ignore the red sell arrows and only look for green buy arrows that appear during temporary pullbacks.
Trading in the direction of the dominant trend significantly improves the success rate of any candlestick signal.
Can I customize which patterns the indicator displays?
The indicator is optimized to show the most profitable setups by default.
However, you can often adjust settings to focus on specific types of patterns that match your personal trading style.
This flexibility allows you to fine-tune the tool for different market conditions or volatility levels.
Summary
The Candlestick Signals Indicator is a robust solution for traders who want to incorporate price action into their strategy without the manual effort.
By translating complex candle formations into simple visual signals, it provides a clear path for identifying high-probability trade entries.
Its ability to supply entry prices alongside directional arrows makes it an incredibly practical tool for daily use.
To maximize the benefits of this tool, it should be integrated into a complete trading plan that considers market structure and trend direction.
Using it as a final confirmation at key levels can greatly enhance your edge.
