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JAPANESE CANDLESTICK PATTERNS JAPANESE CANDLESTICK PATTERNS

JAPANESE CANDLESTICK PATTERNS - PowerPoint Presentation

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Uploaded On 2016-04-29

JAPANESE CANDLESTICK PATTERNS - PPT Presentation

CANDLESTICK SHADOW The line that appears above and below the body is referred as the SHADOW WICK or the TAIL Its almost as important as the body It shows us the range for that period It adds to the bodys interpretation of the market psychology ID: 298895

candle body buy sell body candle sell buy star day shows doji closing gap trend top small opening bottom

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Slide1

JAPANESE CANDLESTICK PATTERNSSlide2

CANDLESTICK SHADOW

The line that appears above and below the body is referred as the SHADOW, WICK or the TAIL

Its almost as important as the body

It shows us the range for that period

It adds to the body’s interpretation of the market psychology

It represents the high and low for that period

The tail on the top shows us the high for that period

The tail on the bottom shows us the low for that periodSlide3

CANDLESTICK SHADOWSlide4

CANDLESTICK SHADOW

A long SHADOW can show support or resistance

depending on where it is in the candle and where

It’s located on the charts

Possible Resistance

Possible SupportSlide5

BASIC CANDLESTICK PATTERNS

MARUBOZO

SHORT DAYLONG DAYSPINNING TOP

DOJI PAPER UMBRELLASlide6

MARUBOZO

Shows large range between the opening and closing price with immediate strength or weakness

Usually the second bar in a reversal or continuation pattern

Has no shadows Slide7

SHORT DAYS

Shows small range between the opening and closing price

Small Shadows

Multiple short days can indicate consolidationSlide8

LONG DAYS

Shows large range between the opening and closing price

Shows strength and weaknessSlide9

SPINNING TOPS

The shadows are longer than the body

Shows indecision

Also seen in consolidationSlide10

DOJI

The open and close must be equal or very close

Gravestone is BEARISH when at the top of a short term rally

Dragonfly is BULLISH when at the bottom of a short term break

Long-Legged shows INDECISION

Usually seen in illiquid markets, no trades may have took place

GRAVESTONE

DRAGONFLY

LONG-LEGGED

FOUR PRICESlide11

GRAVESTONE DOJI

SELL BELOW

Gravestones must be seen at the top of a short term uptrend

Buying comes in right from the opening showing continued strength followed by a selloff later in the day, closing near or on the lows

There could be a small wick or very small body

This must be followed by a confirmation bar to confirm trade

Must sell below the lowsSlide12

DRAGONFLY DOJI

Dragonflys

must be seen at the bottom of a short term downtrend

Selling comes in right from the opening showing continued weakness followed by a rally later in the day, closing near or on the highs

There could be a small wick or very small body

BUY ABOVESlide13

PAPER UMBRELLA

Color does not matter

Location on the charts is what’s important

They can have small shadowsSlide14

CANDLESTICK REVERSAL PATTERNS

HAMMER

HANGING MANINVERTED HAMMER

SHOOTING STAR

ENGULFING

HARAMI

HARAMI CROSSDOJI STAREVENING STARMORNING STARSlide15

HAMMER

Hammers must be seen at the bottom of a downtrend

Aggressive selling right from the open with a recovery

throughout the day, closing near the highs creates the handle

Color of the body does not matter

Must wait for the next candle to confirm before putting on the trade

BUY ABOVESlide16

The Hanging Man must be seen at the top of an uptrend

Aggressive buying right from the open with a selloff

throughout the day, closing near the highs creates the pattern

Color of the body does not matter

Must wait for the next candle to confirm before putting on the

trade

SELL BELOW

HANGING MANSlide17

INVERTED HAMMER

Inverted Hammers must be seen at the bottom of a downtrend

Buying comes in right from the opening with a selloff later in the day

Color of the body does not matter

BUY ABOVESlide18

SHOOTING STAR

Shooting Stars must be seen at the top of an uptrend

Buying comes in right from the opening showing continued strength followed by a selloff later in the day, closing near the lows creating the small body

Color of the body does not matter

Must wait for the next candle to confirm before putting on the

trade

SELL BELOWSlide19

ENGULFING

In an uptrend the open should be higher than previous bars high and in a downtrend the open should be lower than the previous bars low showing a continuation of the trend

The close in should then totally engulf the previous bars high or low to enter the trade

SELL BELOW

BUY ABOVESlide20

The current candle’s range should be completely engulfed by the previous candle’s body

The colors of the bodies should be reversed for a reversal

The size of the second candle affects the magnitude of the reversal

Must wait for the next candle to confirm before putting on the

trade

HARAMI

SELL BELOW

BUY ABOVESlide21

The current candle’s range should be completely engulfed by the previous candle’s body

The size of the second candle affects the magnitude of the reversal

Must wait for the next candle to confirm before putting on the

trade

HARAMI CROSS

SELL BELOW

BUY ABOVESlide22

DOJI STAR

Shows indecision, use overbought/oversold technical indicators when at tops or bottoms of a move

Needs a confirmation candle

BUY ABOVE

SELL BELOWSlide23

MORNING/EVENING DOJI STAR

The star must gap lower at the bottom of a down trend or gap higher at the top of an up trend

Needs a confirmation candle

BUY ABOVE

SELL BELOWSlide24

MORNING/EVENING STAR

The star must gap lower at the bottom of a down trend or gap higher at the top of an up trend

Needs a confirmation candle

BUY ABOVE

SELL BELOWSlide25

ABANDONED BABY

Must have a gap in the direction of the trend followed by a Star or

Doji

This must be followed by another gap in the opposite direction

GAP

GAP

BUY ABOVE

SELL BELOWSlide26

Bullish reversal

Continuation of a bearish trend seen by lower open, making new lows, following a long red candle

Closes the day higher than 50% of the previous body

PIERCING LINE

BUY ABOVESlide27

DARK CLOUD COVER

Bearish reversal

Continuation of a bullish trend seen by higher open, making new highs, following a long green candle

Closes the day lower than 50% of the previous body

SELL BELOW