Chartered Market Technician Practice Exam 2025 – Complete Prep Guide

A series of short candlesticks appearing after longer sessions is typically indicative of weakening momentum. In this scenario, longer candlesticks suggest strong price movement either upwards or downwards, reflecting a clear trend. However, the emergence of short candlesticks following these longer ones can signal a shift in market dynamics.

Short candlesticks often indicate a period of consolidation or indecision among traders. When the market has previously displayed strong bullish or bearish activity, the appearance of short candlesticks suggests that the buying or selling pressure is diminishing. This reduction in price movement indicates that participants may be uncertain about the direction of the market, leading to a potential reversal or pause in the ongoing trend.

While indecision is closely related, the key takeaway here focuses on momentum; the series of short candlesticks represent a fading strength in the prevailing trend. This weakening momentum can be a precursor to a market reversal or a prolonged period of lateral movement until a new direction is determined.