Showing posts with label Candlestick. Show all posts
Showing posts with label Candlestick. Show all posts

Thursday, November 25, 2010

Candlestick Patern - Part 2

Bearish Harami
 
It consists of an unusually large white body followed by a small back body (contained within large white body). It is considered as a bearish pattern when preceded by an uptrend.  
 
 
 
 
 
 
 
 
Bearish Harami Cross
 
It has a large white body followed by a Doji. It is considered as a reversal signal when it appears at the top.  
 
 
 
 
 
 
 
 
 
Bearish 3 Method Formation
 
It has a long black body followed by three small bodies (normally white) and a long black body. The three white bodies are contained within the range of first black body. This is considered as a bearish continuation pattern.  
 
 
 
 
 
Bullish 3 Method Formation
 
It consists of a long white body followed by three small bodies (normally black) and a long white body. The three black bodies are contained within the range of first white body. This is considered as a bullish continuation pattern  
 
 
 
 
 
Bullish Harami
 
It consists of an unusually large black body followed by a small white body (contained within large black body). It is considered as a bullish pattern when preceded by an uptrend.  
 
 
 
 
 
 
 
 
Bullish Harami Cross
 
It has a large black body followed by a Doji. It is considered as a reversal signal when it appears at the bottom.  
 
 
 
 
 
 
 
 
 
Dark Cloud Cover
 
It consists of a long white candlestick followed by a black candlestick that opens above the high of the white candlestick and closes well into the body of the white candlestick. It is considered as a bearish reversal signal during an uptrend.  
 
 
 
 
 
 
 
Engulfing Bearish Line
 
It consists of a small while body that is contained within the followed large black candlestick. When it appears at top it is considered as a major reversal signal.  
 
 
 
 
 
 
 
 
Engulfing Bullish Line
 
It consists of a small black body that is contained within the followed large white candlestick. When it appears at bottom it is interpreted as a major reversal signal.  
 
 
 
 
 
 
 
 
Evening Doji Star
 
It consists of three candlesticks. First is a large white body candlestick followed by a Doji that gap above the white body. The third candlestick is a black body that closes well into the white body. When it appears at the top it is considered as a reversal signal. It signals more bearish trend than the evening star pattern because of the doji that has appeared between the two bodies
 
 
 
 
 
Evening Star
 
It consists of a large white body candlestick followed by a small body candlestick (black or white) that gaps above the previous. The third is a black body candlestick that closes well within the large white body. It is considered as a reversal signal when it appears at top level.  
 
 
 
 
 
 
 
Falling Window
 
A window (gap) is created when the high of the second candlestick is below the low of the preceding candlestick. It is considered that the window should be filled with a probable resistance.  
 
 
 
 
 
 
 
 
Morning Doji Star
 
It consists of a large black body candlestick followed by a Doji that occurred below the preceding candlestick. On the following day, a third white body candlestick is formed that closed well into the black body candlestick which appeared before the Doji. It is considered as a major reversal signal that is more bullish than the regular morning star pattern because of the existence of the Doji.  
 
 
 
 
 
Morning Star
 
It consists of a large black body candlestick followed by a small body (black or white) that occurred below the large black body candlestick. On the following day, a third white body candlestick is formed that closed well into the black body candlestick. It is considered as a major reversal signal when it appears at bottom.  
 
 
 
 
 
 
On Neckline
 
In a downtrend, it consists of a black candlestick followed by a small body white candlestick with its close near the low of the preceding black candlestick. It is considered as a bearish pattern when the low of the white candlestick is penetrated.  
 
 
 
 
 
 
 
Seperating line
 
In a downtrend, a white candlestick is followed by a black candlestick with the preceding opening price. In an uptrend, a black candlestick is followed by a white candlestick with the preceding opening price. It is considered as a continuation pattern that the trend should resume.  
 
 
 
 
 
 
 
Three Black Crows
 
It consists of three long black candlesticks with consecutively lower closes. The closing prices are near to or at their lows. When it appears at top it is considered as a top reversal signal.  
 
 
 
 
 
 
 
 
Three White Soldiers
 
It consists of three long black candlesticks with consecutively higher closes. The closing prices are near to or at their highs. When it appears at bottom it is interpreted as a bottom reversal signal.  
 
 
 
 
 
 
 
 
Tweezer Bottoms
 
It consists of two or more candlesticks with matching bottoms. The candlesticks may or may not be consecutive and the sizes or the colours can vary. It is considered as a minor reversal signal that becomes more important when the candlesticks form another pattern.  
 
 
 
 
 
 
 
Tweezer Tops
 
It consists of two or more candlesticks with matching tops. The candlesticks may or may not be consecutive and the sizes or the colours can vary. It is considered as a minor reversal signal that becomes more important when the candlesticks form another pattern.
 
 
 
 
 
 
 
Doji Star
 
It consists of a black or a white candlestick followed by a Doji that gap above or below these. It is considered as a reversal signal with confirmation during the next trading day.
 
 
 
 
 
 
 
 
 
Piercing Line
 
It consists of a black candlestick followed by a white candlestick that opens lower than the low of preceding but closes more than halfway into black body candlestick. It is considered as reversal signal when it appears at bottom.  
 
 
 
 
 
 
Rising Window
 
A window (gap) is created when the low of the second candlestick is above the high of the preceding candlestick. It is considered that the window should provide support to the selling pressure.  

Tuesday, November 23, 2010

Candlestick Pattern

Big Black Candle
 
 It has an unusually black long body with a wide range between high and low. Prices open near the high and close near the low. It is considered as a bearish pattern
 
 
 
 
 
 
 
 
 
Big White Candle
 
It has an unusually long white body with a wide range between high and low of the day. Prices open near the low and close near the high. It is considered as a bullish pattern.  
 
 
 
 
 
 
 
 
 
Black Body
 
It is formed when the opening price is higher than the closing price and is considered as a bearish signal.
 
 
 
 
 
 
 
 
 
 
Doji
 
It is formed when opening and closing prices are virtually the same. The length of shadows can vary. It is considered that doji candlesticks are usually components of many candlestick pattern.  
 
 
 
 
 
 
 
 
Dragon Fly Doji
 
It is formed when the opening and the closing prices are at the highest of the day. If it has a longer lower shadow it signals more bullish trend. When it appears at market bottom it is considered as a reversal signal.  
 
 
 
 
 
 
 
 
Gravestone Doji
 
It is formed when the opening and closing prices are at the lowest of the day. If it has a longer upper shadow it signals more bearish trend. When it appears at market top it is considered as a reversal signal.  
 
 
 
 
 
 
 
 
Long Legged Doji
 
It consists of a Doji with very long upper and lower shadow. When it appears at market top it is considered as a reversal signal.  
 
 
 
 
 
 
 
 
 
Hanging Man 
 
A black or a white candlestick that consists of a small body near the high with a little or no upper shadow and a long lower tail. The lower tail should be two or three times the height of the body. It is considered as a bearish pattern during an uptrend.  
 
 
 
 
 
 
 
Hammer
 
A black or a white candlestick that consists of a small body near the high with a little or no upper shadow and a long lower tail. It is considered as a bullish pattern during a downtrend.  
 
 
 
 
 
 
 
 
 
Invented Black Hammer
 
A black body is formed in an upside-down hammer position. It is considered as a bottom reversal signal that needs confirmation on the next trading day.








Invented Hammer
 
It consists of black or a white candlestick in an upside-down hammer position. It is considered as a bottom reversal signal that needs confirmation on the next trading day.
 
 
 
 
 
 
 
 
Long Lower Shadow
 
A black or a white candlestick is formed with a lower tail that has a length of 2/3 or more of the total range of the candlestick. Normally, it is considered as a bullish signal when it appears around price support levels.
 
 
 
 
 
 
 
 
Long Upper Shadow
 
A black or a white candlestick with a upper shadow that has a length of 2/3 or more of the total range of the candlestick. Normally, It is considered as a bearish signal, when it appears around price resistance levels.  
 
 
 
 
 
 
 
 
Marubozu
 
A long or a normal candlestick (black or white) is formed with no shadow or tail. The high and the low is consisted of the opening and the closing prices. It is considered as a continuation pattern.
 
 
 
 
 
 
 
 
 
Shooting Star
 
A black or a white candlestick is formed that has a small body, a long upper shadow and a little or no lower tail. It is considered as a bearish pattern in an uptrend.  
 
 
 
 
 
 
 
 
 
Spinning Top
 
A black or a white candlestick is formed with a small body. The size of shadows can vary. It is interpreted as a neutral pattern but gains more importance when it is part of other formations.  
 
 
 
 
 
 
 
 
 
White Body
 
It is formed when the closing price is higher than the opening price and is considered as a bullish signal.
 
 
 
 
 
 
 
 
 
 
Shaven Bottom
 
A black or a white candlestick is formed with no lower tail. It can be compared with Inverted Hammer.  
 
 
 
 
 
 
 
 
 
Shaven Head
 
A black or a white candlestick is formed with no upper shadow. It can be compared with a hammer.  

Candlestick Bar

Candlestick bars still indicate the high-to-low range with a vertical line.
However, in candlestick charting, the larger block (or body) in the middle indicates the range between the opening and closing prices. Traditionally, if the block in the middle is filled or colored in, then the currency closed lower than it opened.

In the following example, the 'filled color' is black. For our 'filled' blocks, the top of the block is the opening price, and the bottom of the block is the closing price. If the closing price is higher than the opening price, then the block in the middle will be "white" or hollow or unfilled.

Candlestick Price Bar

We simply substituted green instead of white, and red instead of black. This means that if the price closed higher than it opened, the candlestick would be green.
If the price closed lower than it opened, the candlestick would be red.
In our later lessons, you will see how using green and red candles will allow you to "see" things on the charts much faster, such as uptrend/downtrends and possible reversal points.
For now, just remember that we use red and green candlesticks instead of black and white and we will be using these colors from now on.

 
Colored Candlestick Price Bar
 

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