How to Use Candlesticks in a High-Probability Way | Tutorial #4

Candlesticks + Support & Resistance in a Downtrend (Context Matters)

In this part, we move beyond isolated candlesticks and place them into real market context.

This tutorial focuses on combining candlesticks with Support & Resistance within a downtrend, which is where high-probability setups are actually formed.

⚠️ Important note:
This part is slightly more advanced than the previous three tutorials.
If something on the chart is unclear, feel free to ask in the comments — I’ll do my best to answer everyone.

Don’t worry if it feels complex at first.
We are just scratching the surface — from here, the real trading logic begins.

Strongly recommended:
Review Tutorials #1–#3 first.
Each part builds on the previous one, and this structure will continue throughout the series.

📌 Chart Explanation (NZDUSD Example)

I’m using NZDUSD again, the same pair from Part 1, to keep everything consistent and easier to follow.

On the chart, you can see:

1️⃣ Candlesticks
→ They show price reactions when reversals or rejections occur.
2️⃣ Support & Resistance Zones
→ Key areas where price previously reacted.
3️⃣ Numbers (1–3)
→ Represent multiple touches of support and resistance, increasing their importance.
4️⃣ Market Structure
→ Lower Highs + Lower Lows = Downtrend context
5️⃣ Directional Arrows
→ Visual guidance for trend direction and corrections.

🧠 Why Context Changes Everything
Up to now, we worked mainly with candlesticks and trend direction.
Now we add the most important missing piece for high-probability trading:

👉 Support & Resistance

Candlesticks do not create signals on their own.
They become powerful only when they appear at the right location within market structure.

(If Support & Resistance is not fully clear yet, I’ve already published Part 1 of that tutorial — feel free to ask in the comments, and I’ll gladly make Part 2.)

📈 Finding Trade Opportunities — Step by Step
(Using all 4 tutorials together)

1️⃣ Identify a downtrend
→ Lower highs & lower lows
2️⃣ Draw Support & Resistance zones
3️⃣ Wait for candlestick stacking
→ As explained in previous tutorials (clusters, sequences, pressure buildup)

🔥 Bonus Confirmation
If, after candlesticks stack together, you see:

• an Engulfing candle, or
  
• a Momentum candle

that’s a strong sign that buyers or sellers are stepping in aggressively.
This is where probability increases, not because of one candle — but because everything aligns.

🛡 Risk Management Reminder

• No setup is guaranteed.
  
• Always apply proper risk management and position sizing.
  
• If you’re still learning or testing these concepts, it is strongly recommended to practice on a demo account first before risking real capital.
  
• Trading is a process, not a shortcut to fast profits.
  
• Focus on consistency, discipline, and execution — not outcomes.
  

🧠 Continuing the Series

• If anything on the chart is unclear, feel free to ask in the comments — I’ll do my best to help.
  
• This tutorial is part of a structured series where each part builds on the previous one.
  
• Following simply helps you keep track of future lessons.
  

⚠️ DISCLAIMER
This content is for educational purposes only and does not constitute financial advice.
Trading involves risk — always conduct your own analysis.
I am not responsible for any decisions or losses based on this material.