Thanks again for all your hard work, Tymen. I’m just waiting to see some patterns come up in my limited trading hours. I do have one question. You mentioned something awhile back about a modified stochastics curve on (I believe) the 5 min STARC chart. Is this a future refinement or was it scrapped due to lack of necessity?
which time frame do you guys best recommend using technicals i mean which time frame can they be really accurate or at least reliable? I read before that some technical indicators are better in the long term…
It is always a nice idea to read a thread before posting…
I would be pleased to help you as soon as your question will be thread related.
Wow! Definitely one of the most useful and best developed threads I have come across since I discovered Forex!
Took me 2 days and 1 night to read it through (and I’m sure I’ll have to do it again to get a real grasp on this trading style…), but definitely worth every minute of missed sleep… 
Thank you Tymen (and everyone else who has contributed to the evolution of this thread) for your efforts and guidance.
Look forward to learning more from you!
FXCaribbean,
I try to download the word file at RapidShare: Easy Filehosting, but it always give me an Error msgs as below:
Your IP address XXX.XX.XX.X is already downloading a file. Please wait until the download is completed.
But I don’t have anything download when try to download the file, so what the problem? Any others ways to download the files instead of using rapidshare??
Go to that link and click on the first link in the “Interesting Links” section. Then, follow the instruction (= wait 
)
FXCaribbean
"Don’t go where there is a path. Open a new one and leave a trail".
If you want to understand what we’re talking about here (UMS) then read this and set your screen and computer that way. Also read the live thread, UML Live and UMS Live
Tymen,
Thanks for posting such a concise explanation of the 4 levels. The effort that you put into developing them is evident.
I am still working with 4 hour charts, here in the Pacific time zone. The second and third levels seem to be very effecitve in this timeframe.
One question: Why does it say to watch and close at zero profit if the second amount goes in the wrong direction? Nothing is said about moving the stop loss to be sure the second amount isn’t a loss.
On 4 hour charts, I have moved the stop loss on the second amount to +10. It’s a very cool way to trade, knowing I’ll have at least 10 pips no matter what happens.
Thanks for all of your hard work!
Thanks for sharing.
Tymen, I turned your posts of The 4 Levels of Candlestick Trading into a PDF - ATTACHED.
If anyone finds having the PDF useful, please add to my reputation. Thanks.
And thanks again, Tymen, I appreciate your efforts.
Tymen_CandleSticks.pdf (599 KB)
Hello all. I’ve taken the last few days to read this entire thread. It is nice to see a lot of hard work and detailed ideas and strategies as opposed to the general trading euphemisms that pass for insight/advice. I have a question for Tymen, or anyone else who feels he has a satisfactory answer.
I understand that Tymen and those who are also trading this strategy scan candlestick charts ranging from 20-60 minutes or more. The goal is to identify and trade well-defined candlestick patterns. Quite a bit of emphasis has been placed on patience and only trading patterns that meet strict criteria.
However, is it not true that a perfect evening star pattern on a 30min chart might look quite different on 20 and 40min charts? Effectively, while trading a well-defined pattern on the chart for one interval isn’t one potentially trading a broken, incomplete or otherwise inferior pattern on a chart for a slightly different time interval?
Looking at patterns in 5 minute increments seems like an arbitrary way to sort price information. (I do understand it is the foundation of much of technical analysis to sort info in standardized time increments)
I have a hard time reconciling that a well-defined pattern on a 30 minute chart could be an above average trading opportunity while the same price information on a 35 minute chart could quite possibly be considered not worthy of trading.
I look forward to having someone sort this out for me.
I would like to try to answer you… but i’m not sure i’ll have it all
It is true that a perfect Evening Star in one timeframe will not exist for another one. BUT, you will not have the opposite. That is , you will not have a bullish engulfing if you can see an evening star.
Reading a little bit more about candlestick i saw that an evening star can be more than 3 candles. I mean you can have a large green one, then more than one doji (gravestone, dragon fly, and/or spinning top) then the real red one. All of those “middle” candle are part of the star. This is why the color of
the star doesn’t really matter.
So if you look at a small timeframe you can see many candles, then if you take bigger timeframe the stars are adding themselves to each other. It is then easier to “see” the evening star.
The shortcut you do by taking 20 to 60mn, help you not to be ambiguous and just look to have it built …or not.
Thanks for your response, I’m not sure that it really addresses my question however. From my study of candlesticks (and it has been a few years now) the patterns fall basically into three categories: bearish reversals, bullish reversals, and continuations. I am a firm believer in thebenefits they offer for establishing the end of trends and potential reversals.
My concern is that they are more general tools for identifying such price points. I think that this system might be overstating the precision of these tools. I can’t really see how a pattern on a 30 min chart could be tradeable, but not the same data on a 35 minute chart. To me these timeframes should be more spread out. I think scanning and trading 25 and 35 minute charts is a way of justifying trading a suspect pattern on a 30 minute chart. If the system provided steps upon entry that were very time specific to the chart they were traded off of this might make more sense. What I mean is that I don’t understand there to be a substantive difference in the way a position is managed whether it is initiated from a 25 or 35 minute chart. If this is correct then as I stated in the previous post you are potentially effectively trading an inferior pattern on a chart from a very similar time frame. If I am misstating the rules of the system, or leaving some aspect out please correct me. Perhaps this is a question for Tymen himslef to clear up.
I have wondered about this also. I’d like to know what Tymen has to say about it.
From my own understanding of tymen’s system, he always looks for quality candlestick patterns which occur on the top of bottom of the Bollinger bands to trade. In addition his style of trading from my understanding is fast, which make use of the fast forex movements in the currency pairs and do not require trader to hold onto a position for long but needs close monitoring when a trade has been entered. When a quality candlestick pattern appeared on a 30 mins chart but a lousy pattern on a 35 min chart, we only look at the 30 mins chart which we will be trading and ignore other tf charts. After a trade is entered and stop loss level set we will monitor the trade closely. If the stop loss level is hit we will look for other quality patterns to trade. If a trade makes 10pips profit we will quickly close out one lot and move stop loss for the remaining lot to break even point. When the remaining lot meets our target profit, we will get out or get out when break-even point is hit. His trade managment and choosing of strict candlestick patterns make up for the loss of the differences of patterns in different timeframes and the need to determine the trend. Just my own point of view.
I had the same question in the beginning. I’m not sure why it works but it does. I think there is something to looking for a “justification” of a trade. There have been plenty of swings where I’ve seen no reversal pattern on the 15 minute but on the 30 or 40 minute there was a nice pattern. Even though there is no pattern on one timeframe, the price still reversed. So I believe it gives you more opportunities to trade the same price action than you would get with just one timeframe.
IMO, you will just not see the same pattern on 2 timeframe at the same time. It is just because of the way candles are designed.
What I mean is that I don’t understand there to be a substantive difference in the way a position is managed whether it is initiated from a 25 or 35 minute chart. If this is correct then as I stated in the previous post you are potentially effectively trading an inferior pattern on a chart from a very similar time frame.
timeframe isn’t the only change. You also have Bollinger Bands that will dynamically change. Remember there is a combination of pattern & BB to decide about a trade.
Is your question is the fact that the timeframe to decide to enter is greater than the one really that is used to trade, and how/why this concept has been built ? If that is your query, i would also like the answer
If I am misstating the rules of the system, or leaving some aspect out please correct me. Perhaps this is a question for Tymen himslef to clear up.
Sure he will…
I’ll explain my theory on the subject. Keep in mind these are only my own beliefs and are to be taken with a grain of salt.
The candlesticks patterns as we know them are characterized by particular movements of the price action which we see on our charts. [U]For example[/U], the [B]evening star[/B] is characterized by a [B]steady rise[/B], followed by a [B]slowdown[/B] of the action and an [B]eventual drop[/B]. It could be seen like the top of a [I]hill[/I], or maybe like a ‘’[I]plateau[/I]’’.
Ideally, we should look for these pattern on the lowest timeframe possible, without hindering our visibility. That would be a 5-10m chart. One would then look for a composition of candles which correspond to a pattern. That kind of interpretation requires some practice and may be less easy to some people.
The other option left is to look at as many timeframes as possible to see the base pattern as seen in the books. It’s the easy way of doing it, although it requires quite a bit more screen real estate and more vigilance.
It might be a good idea to open only a few charts which differ significantly in size to be able to see the price movement on shorter and longer term.
My 2�. Hope I have answered some questions.
Great thread you guys, very helpful I’m really looking forward to sinking my teeth in “simple candlestick trading” I understand the patterns but I’m having trouble understanding the 5 min chart with starc bands so if someone that had GFT charting would post a pic that would be most helpful thanks.
Thanks for everyone’s thoughts, some people did a nice job summarizing the system, but I’m not sure we got to the bottom of my question. Just wanted to let you know I haven’t lost interest in the topic, kinda hoping Tymen will chime in at this point.
As a side note, I am experimenting with Dealbook. I am going to post a couple questions about order entry in the appropriate forum. I know there are a lot of Dealbook users on this thread though so I wanted to get your attention.