Reversal patterns are candlestick formations that indicate a possible change in the direction of the trend. Generally, they occur at the end of an uptrend or a downtrend and signal a shift in the balance of power between buyers and sellers. Two of the most common reversal patterns are the Hammer and Hanging Man, which have a small body and a long lower shadow. A Hammer forms at the bottom of a downtrend, suggesting buyers are pushing the price up, while a Hanging Man forms at the top of an uptrend, indicating sellers are taking over. The Engulfing pattern is another two-candle pattern that consists of a small candle followed by a larger candle of the opposite color that completely covers the first one. A bullish Engulfing forms when a green candle engulfs a red candle at the end of a downtrend, while a bearish Engulfing forms when a red candle engulfs a green candle at the end of an uptrend. Lastly, the Morning Star and Evening Star are three-candle patterns that consist of a large candle, a small candle, and another large candle of the opposite color. A Morning Star forms when a red candle is followed by a small candle and then a green candle that closes above the midpoint of the first candle, while an Evening Star forms when a green candle is followed by a small candle and then a red candle that closes below the midpoint of the first candle.