SR CHART PATTERNS - JAPANESE CANDLES 2

SR CHART PATTERNS - JAPANESE CANDLES 2

JAPANESE CANDLES - TEXT VERSION

CANDLESTICK CHART PATTERNS

Back in our introduction to Japanese candles, we have a tendency to saw however otherwise formed candles mirrored market sentiment for the length of the candles. For example:

Japanese holder with Long Body/No Wicks

A candle like this one, with a protracted body and small or no wick means there was no indecision regarding worth. throughout the amount this candle covers, traders were marketing and worth was heading lower from the beginning.

Conversely, a candle like this one indicated that traders couldn’t frame their minds. worth gyrated around its gap level and when several movement tense just about unchanged.

Similarly, whole sequences of willdles can kind shapes or patterns that recommend each what markets area unit feeling a couple of given currency try (or different asset) and wherever worth is probably going to travel within the future.

We can see one form of holder chart pattern in figure three.5, shown below.

Support And Resistance Chart Patterns Japanese Candles thirty three

In a previous lesson, we have a tendency to mentioned however a number of the various holder shapes and combination shapes hinted at what traders were thinking and so however worth may move within the close to future.

When victimization chart patterns, it's simple to forecast however worth would move at some future date. If it moves lower, we are able to provide a number of reasons why this move may are expected supported the knowledge we have a tendency to had up to it purpose.

In fact, usually the form of the willdle pattern can recommend a coming back move downward. they'd kind a “bearish head and shoulders pattern,” that is comparable to a “W” with the next center peak that's resembling a head flanked by 2 shoulders.

When this pattern seems throughout AN uptrend, it usually signals that this uptrend is getting ready to reverse. 

A whole shebang of the various holder chart patterns may cowl many lessons. We’ll cowl these in bigger depth later. For now, simply grasp that these patterns exist and area unit another tool for characteristic support / resistance levels and wherever worth is probably going to pause or reverse its direction.

INSTRUCTOR'S NOTES

This lesson’s video aims to explain:

Candles that shut terribly close to their highs tend to point bullishness, particularly if they follow another similar candle

Candles that shut terribly close to their lows tend to point bearishness, particularly if they follow another similar candle

The Head & Shoulders chart pattern: it's suggested to not place an excessive amount of weight on this precise pattern as a predictor of worth movement. However, in AN uptrend, a failure to create the next high followed by a lower low is indicative of a trend amendment, and contrariwise in an exceedingly downtrend