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Candlesticks and Patterns

The document outlines the structure and topics of a course on Japanese candlestick patterns and trading. The course will cover: 1) The structure of candlestick charts and reversal patterns like hammers and engulfing patterns 2) Continuation patterns like rising/falling three methods and mat holds 3) Using candlestick charts with indicators, trading breakouts, and trading strategies Specific candlestick patterns like dark cloud covers, piercing lines, and harami are also defined. Examples of patterns in currency pairs are shown to illustrate the concepts.

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Jeffrey_Del_Mario
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174 views27 pages

Candlesticks and Patterns

The document outlines the structure and topics of a course on Japanese candlestick patterns and trading. The course will cover: 1) The structure of candlestick charts and reversal patterns like hammers and engulfing patterns 2) Continuation patterns like rising/falling three methods and mat holds 3) Using candlestick charts with indicators, trading breakouts, and trading strategies Specific candlestick patterns like dark cloud covers, piercing lines, and harami are also defined. Examples of patterns in currency pairs are shown to illustrate the concepts.

Uploaded by

Jeffrey_Del_Mario
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Japanese candlestccs and paterns

Trading without indicators


-1
Structure of the course
1. Aug 28: structure of a candlestcc, reversal paterns
2. Sep 4: contnuaton paterns
3. Sep 11: candlestccs + indicators, trading breacouts, trading
strategies
Candlestick chart is the most
informative
Structure of a candlestick

Steve Nison, Japanese candlestck chartng techniques


Reversal paterns Contnuaton paterns
• Hammer/Hanging man • Rising/Falling Three Methods
• Morning/Evening star • Upside/Downside Tasuci
• Piercing Line/Darc Cloud Cover • Mat Hold
• Harami • Three Line Strice
• Harami cross • In-Necc/On Necc
• Engulfng
• Tweezers
Engulfng
• Logic: bulls or bears seize the
power
• Consists of 2 contrastng candles
• Looc at the bodies
• Only afer the distnct trend
• Signal is stronger if one body is
small and second is big
• Signal is very strong, when one
candle engulfs many
USD/MXN, D1
USD/JPY, W1
Hammer & Hanging Man
• 1-candle patern
• Logic: shows tredness of the main trend
• Lower shadow is 2-3 tmes longer than
the body. No or small upper shadow
• The body is in the upper part of the range
• The longer the shadow, the stronger the
signal
• The stronger the trend, the stronger the
signal
• Color is not important
EUR/USD, D1
Shooting Star & Inverted Hammer
• 1-candle patern
• Logic: shows tredness of the main trend
• Upper shadow is 2-3 tmes longer than
the body. No or small lower shadow
• The body is in the lower part of the range
• The longer the shadow, the stronger the
signal
• The stronger the trend, the stronger the
signal
• Color is not important
The signal is stronger if there’s a gap away
from the prior real body.
EUR/GBP, H4
Harami

• 2 contrastng candles
• Body of the frst candle overlaps
body of the second one
• First – mother, second – child
• Confrmaton is always
necessary!
Inside bar Inside bar +
Fakey
USD/JPY, H1
Fakey
AUD/USD, MN
Dark cloud cover
• 2 contrastng candles with big
bodies
• Second candle opens with a gap
up, but is bearish
• Second candle overlaps the most
of the frst candle’s body
• Signal is stronger when the
second candle is below
important resistance
Piercing line
• 2 contrastng candles with big
bodies
• Second candle opens with a gap
down, but is bullish
• Second candle overlaps the most
of the frst candle’s body
• Signal is stronger when the
second candle is above
important support
USD/CAD, MN

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