Hello.
I have been scratching my head over the close price on the Heiken Ashi cheat sheet. The babypips cheat sheet shows that the values used to calculate come from the previous candles values. Every other video shows the close being calculated using the current high, low, open and close.
I think the cheart sheet is wrong.
This School lesson before the cheat sheet says the following:
The CLOSE of each Heikin Ashi candlestick equals the average value between the four parameters: open, close, high, and low:
Close = (Open + High + Low + Close) / 4
No mention of “Previous Candle” like for “Open”
If you look closely at the chart, you’ll notice that e very new candlestick starts from the middle of the previous one .
Open = [(Open price of previous candle) + (Close price of previous candle)] / 2
Here are formulas for the Heiken-Ashi OPEN and CLOSE that are more explicit than the formulas you will see elsewhere –
Heiken-Ashi OPEN = ½ x [previous HA open + previous HA close]
Heiken-Ashi CLOSE = ¼ x [actual open + actual high + actual low + actual close]
If you want more on Heiken-Ashi, take a look at this thread –