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Forex Expert - Basic Candlestick Charting

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					                                               Basic Candlestick Charting




Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                               Candle
                                                                                                                             Construction
                                           What are a candle’s basic elements?




Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Patterns



      • A Long White Candle 
        signals that the buyers 
        are in control Bullish
      • A Long Black Candle 
        signals that the sellers 
        are in control Bearish




Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Doji’s & Dragonflies


      • A Doji occurs when the open  
        & close are at the same price, 
        near the middle of the range.  
        This signals indecision in a 
        sideways market, while in a 
        trending market usually the 
        market taking a breathe.
      • A Dragonfly is a doji that has 
        a same price open/close near 
        the top of the range Signals 
        a reversal after a downtrend


Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                              Hammer
                                                                                                                             Gravestone

   • A Hammer signals a reversal 
     after a down move.  The shadow 
     should be at least 2 times as long 
     as the height of the body.  If this 
     occurs after an uptrend it is 
     called a ‘hanging man’ & is 
     considered a bearish signal
   • A Gravestone is constructed 
     when the open & close are near 
     the bottom of the range.  This 
     formation signals a reversal 
     when it happens in an uptrend


Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Dark Cloud
                                                                                                                               Cover



      • The Dark Cloud 
        Cover is a two 
        candle pattern that 
        occurs after an 
        uptrend, signaling a 
        reversal



Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Piercing
                                                                                                                             Pattern



      • The Piercing Pattern
        is also a two candle 
        formation, but is the 
        opposite of the dark 
        Cloud & is a reversal 
        signal after a down 
        move 


Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Bullish/Bearish
                                                                                                                               Engulfing

      • Engulfing patterns are two 
        candle formations usually 
        w/out any shadows, 
        sometimes a small shadow 
        is ok. The 2nd body 
        (candle) completely 
        engulfs the 1st.  These 
        signals are only 
        meaningful after an 
        extremely prolonged trend


Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Morning Star

      • A Star is typically made up of 
        a long body followed by a 
        short body w/ a small shadow.  
        The bodies of the two must not 
        overlap, though the shadows 
        may.  The Morning Star
        pattern is a bullish reversal 
        after a down move.  The 1st bar 
        will have a long black body, 
        the 2nd will gap down from the 
        1st. This is followed by a long 
        white body that closes within 
        the top half of the body of the 
        1st bar

Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Evening Star




      • An Evening Star is 
        opposite a Morning 
        Star & is a reversal 
        signal at the end of 
        an uptrend



Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Shooting &
                                                                                                                              Doji Stars

        • A Doji star formation is weaker 
          than the Morning or Evening 
          Star‐ the doji represents a 
          market undecided.  With a 
          Shooting Star the body on the 
          second bar must be near the low 
          – at the bottom end of the range.  
          The upper shadow must be 
          longer.  This is also a weaker 
          signal after a trend. Both of 
          these patterns require 
          confirmation by the next bar 
          closing below half‐way on the 
          first bar


Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Harami




      • The Harami
        formation indicates 
        a loss of momentum 
        & is often indicative 
        of a future change in 
        trend



Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                                                                             Rising & falling
                                                                                                                             Three Methods

      • The Rising Method
        consists of two strong 
        white lines bracketing 3 or 
        4 small declining black 
        lines. The final white line 
        forms a new closing 
        high Bullish
      • The bearish Falling 
        Method is bracketed by 
        strong black bars, the 2nd
        black bar forming a new 
        closing low

Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction
                                                                 Keep In Mind

         Trading on the strength of candlestick signals 
              alone is not advisable…Just like most 
          indicators they must be taken with a grain of 
           salt & used along with some other analysis 
                 tool Fundamental or Technical
          Employing both technical & fundamental analysis techniques when examining market activity would be considered prudent 




Futures and options trading involves substantial risk, is not for every trader and only risk capital should be used. The
information and data in this report were obtained from sources considered reliable. Any decision to purchase or sell as a
result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction

				
DOCUMENT INFO
Description: Even though the structure of candlesticks is different from that of bar charts, it is easy to combine candlesticks with the technical chart analysis. By focusing on the relationship between open and close Short entry prices, candlesticks show how market forces change during market hours. This often indicates the short-term momentum in different products or markets.