Japanese Candlestick Charting Techniques: A Contemporary Guide to the Ancient Investment Techniques of the Far East by Steve NisonVery clear description of the basic candlestick patterns. Many of the patterns rely on gaps between closing and opening prices. This type of trading applies to equities and to other markets that have pretty clear opening and closing times -- like the Japanese Rice market where this charting technique originated. The Forex market, for all practical purposes, is free of such gaps. This difference means that many candlestick patterns have only limited application to the forex markets. Thus, while there may be quite a bit to learn about candlesticks in a market filled with gaps, the material reduces to a manageable amount when you exclude any of the patterns that require a gap of some sort.
Except for the weekend close, the opening and closing periods in forex are basically arbitrary. They retain their force, I believe, because every broker uses the same break points, at least for any chart that tracks an hour or less. The weekly and monthly charts are also the same for all traders. There is some slight variation for Daily and four hour charts, depending on the brokers time zones, but these provide only slight variations for the most part. Thus, candlestick charts work because traders all rely on the same data for the fictional opening and closing points of the bars of their charts. But that fiction is enough to make a real difference, because it makes a difference in the expectations of traders, and makes a difference on when traders are likely to make their decisions.
My main criticism is his selective examples. Anyone can pick out a chart and show how it illustrates their method. And I suppose that needs to be done. But if you look closely at Nisons examples, you will see many failed signals for patterns that had already been discussed, or that would be discussed later. Nison is very good at showing where the patterns work. He also seems to be very good at ignoring the examples in his own charts where the patterns fail.
Overall, Im a fan of candlesticks. I dont think they tell a whole lot. But they are clearer than bar charts or line charts at showing what might have happened during a time period. So, even if they dont provide much of an edge, for me they are still the clearest picture I can get.
Trading applications of Japanese candlestick charting
You are currently using the site but have requested a page in the site. Would you like to change to the site? Gary S. Wagner , Bradley L. Wagner and Bradley L. Candlestick Fundamentals and History. Candle Location.
Wagner; Bradley L. Review feedback? Click here. But this manual can turn your frustration into profit. This in-depth work presents the latest techniques for combining candlestick charts with traditional technical studies for fabulous results. Learn the most profitable candlestick patterns, then see how to exploit them to the fullest, using the power and precision of western technical tools like stochastics, Elliott Wave, moving averages and other oscillators.
Japanese Candlestick Patterns are a powerful analytical tool that can produce rosy returns for you in forex trading. There are many candlestick patterns available but only few patterns provide strong reversal signals and are worth knowing. We have summarized the 14 most powerful reversal candlestick patterns here to help you understand and master them quickly in less than 5 days. Learning the Japanese Candlestick Patterns has never been so easy and fun. Let's get your journey started now!
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Combines the expertise of a registered commodity broker and a systems analyst to bring readers up to date on candlestick charting methods. Goes a step beyond existing literature to discuss practical applications of this technique and recommended strategies.