Just to let everyone know that my promised thread on candlestick charting will be starting after the weekend if all goes well.
Just now we are experiencing some extremely hot weather here - there is a cyclone (hurricane) up north of Western Australia. These bring us very hot and sticky weather. It is no fun working or living in it.
So I am feeling very drained, but otherwise all is on shedule.
Looking forward to it Tymen. Will be a good addition to the site which I shall read as I perambulate from pool to air conditioner and back with cold drink in hand!
It really is a good idea to start a thread on Candlestick charting…
Can somebody pls. tell me if ‘HANGING MAN’ on the attachment is what caused trend reversal ?
Thanks - Mave
Firstly, I think you’ll find that particular candle print would carry the descriptive term of [B]hammer[/B] rather than hanging man.
A hanging man prints at the top of a move of up in prices (resistance or supply), where by hammers are generally found at the low end (support or demand) of a price move. Hence why the activity of those 2 candles signify the current psychological stance of the market related to the open & close of the candle.
However, these candle prints also require additional confirmation of their intent. They also tend to carry more weight when they print on higher timeframes than a fast intraday frame reference.
The specific illustration you show on your example is nothing more than low volume activity on an instrument which tends to go into sleep mode outside it’s primary local trading timezone, ie: London business hours.
So, in effect, no there was nothing going on in that time frame, at that level, at the time you posted your example to alert traders regards the candle print.
always looking for more info on candlsticks, to do with forex.
and what does anyone think about heiken ashi candles, are they worth trying to figure out.
i have been experimenting with them with not much sucess so far.
Look forward to this one sir. I just came back from working on NW shelf in Aus and yes, very hot and humid. A few cold beers seemed to be the order of the day.
On another note, I have an e-copy of Steve Nison’s book on candlestick charting but have yet to get round to readind it yet.
Cheers
Some qtns. on Reversal patterns…
Attachment - Bearish Engulfing Pattern.jpg
Qtn1: What candle should be the 3rd candle (red box) in order to give confirmation of Bearish Engulfing Pattern ?
I presume that it should be BEARISH candle.
Qtn2: Does OPEN/CLOSE/SHADOW price have any importance of the 3rd candle (red box) for it give confirmation of Bearish Engulfing Patt. ?
In the webpage below concentrate on the [U][B]three outside down[/B][/U]
reversal pattern.
Bearish Reversal Candlestick Patterns
Also as you progress you will see that these patterns coinciding
with certain reversal points helps. ie S/R areas.
Thanx DayDreamer.
I’m quite familiar with most of Reversal pattern formations, but you have’nt actually answered my qtn…
Candle reversal pattern formations constitute of single candles such as DOJI, some comprise of 2 candle formations such as Bearish Engulfing Pattern, some even 3 candle formations.
So, as with Bearish Engulfing Pattern, what should be [B]3rd candle[/B] to give confirmation of reversal ?
Mave
I’m quite familiar with most of Reversal pattern formations, but you have’nt actually answered my qtn…
Did you look at the webpage, at three outside down,
where is the 3rd candle going. I would hope in a bearish
reversal pattern it would be going down.
If not you’re stop loss will be taken out & you will need to
start again with your TA of the situation.
So yes I did answer the question with an illustration.
My thread is underway now - “THE JOY OF CANDLESTICK CHARTING - a Learning Experience”…[U]NEWBIE ISLAND[/U]
Please post your questions there.
Can somebody pls. enlighten me what reversal pattern is shown on the attachment ?
Is it a ‘HAMMER’ ?
Thanks - Mave
It’s definitely not a hammer. I’ve attached a chart example below with an exhaustion shift flipping to the upside which is highlighted by the hammer candle.
Your example is merely a bullish shade or a minor bullish cover. But then I notice that it’s an intraday chart. To be honest the more reliable candle formations at potential trend exhaustion levels such as hammers, hanging man, cloud covers, etc tend to materialize on the big chart frames; Daily-Weekly-Monthly.
I guess you could shift down maybe to a 4 hrly chart, but any lower than that & you’re dealing with an awful lot of sludge & false signals.
To even begin relying on candle prints on sub hourly charts you’d definitely want to be observing & triggering them off well lit support & resistance levels.
Can somebody pls. tell me which Rev. pattern is displayed on the attachment (orange square) ?
Thanks - Mave
I am really looking forward to learning some new approaches 
It looks to me that if you included 3 more candles to the left of your orange box, then it could be a “Breakaway” pattern.
Whaz up with this? Something get a little lost in the translation? 
To Maverick27 :
To answer your question finally :
You have 2 posts with 2 thumbnails and 2 different pictures.
[B]You do not display the Bolinger bands so that anything could happen if not on the BB extremes.[/B]
In the first one, it looks like an engulfing pattern but on closer inspection it is not so in the strictest sense. It must, therefore, be ingnored.
In the 2nd picture the candle in the orange square you display is a Marubozu or shaven candle. It is extremely strong in an uptrend but in a downtrend it generally shows a trend running out of puff.
In your case nothing definite is visible an I would simply ignore it.
[B]Please post all future questions on my main thread - this thread was only meant to be an introduction.[/B]
THIS THREAD IS CLOSED.
