Observing the movement of stock prices in Japanese Candlestick format and in real-time depiction is somewhat akin to watching the printout of an electrocardiogram in motion. One is seeing at first hand the story of an unfolding investor psychology. The first practitioner of Candlestick price representation, so many centuries ago in Japan, was no doubt seeking to develop a strategy or a system of tactics which would deliver to him a trading advantage which would assist him in planning his next moves. The technique of price recordation which he developed was based on the principle of expanding the “line,” or “bar,” on a chart representing the range of prices for a given time period so as to create a fattened-out line, or cylinder, in which the opening price and the closing price for that time period would be the upper and lower limits of the cylinder. If the closing price of the day were higher than the opening price, then the cylinder would not be filled in, or would be left “white;” whereas if the closing price of the day were lower than the opening price, then the cylinder would be filled in, or made “black.”
This style of price display presented a visual picture which was instantly recognized by the eye. It was easy to discern the mood of the rice traders which was in effect during that session; and, depending on the relationship of that particular Candle bar’s relationship to adjacent and nearby bars, the operator had a basis for making a prediction of the direction of prices for the next day.
Furthermore, when interpreted properly in the light of human judgment, the shape of a bar, especially when considered in conjunction with adjacent or nearby bars, was found to possess an ability to forecast a reversal of major trend.
After long and expensive historical research and translation of old records into English, the Candlestick approach to price charting was brought to the Occidental world about 25 years ago. In the early years, the Candles developed a following only very slowly. More recently, however, professional traders and investors, as well as those who do not trade or invest for a living, have begun to appreciate the advantages of the Candlesticks, to the point at which it seems reasonable to predict that they will be the standard within the foreseeable future.
What is so unusual about the Candles? In short, they form patterns which have meaning in terms of revealing traders’ theretofore-hidden investment rationale, and also in terms of allowing forecasts to be made regarding the future course of price action. Some of these visual formations or images are useful in foretelling the end of a trend and a possible topping out and rollover to the downside (if the major trend has been one of increasing prices) or of bottoming out and rolling to the upside (if the major trend has been one of declining prices).
At the top of an extended rising market, one of the more dependable reversal patterns is the “Evening Star,” a three-bar pattern in which the first bar is a tall white bar; the middle bar is a small “Star” which usually sits higher than the first bar; and the third bar is a tall black candle which usually sits lower than the Star. This formation is bearish in its implications; and the implication is strengthened if the Star is a “Shooting Star,” which looks like its namesake. At the end of an extended declining market, the inverse pattern can also appear; and, perhaps not unexpectedly, its name is the “Morning Star.”
The opposite of the Shooting Star is the “Hammer,” which appears only at the end of an extend downtrend. The Hammer is considered to be one of the more reliable predictors of a possible change of trend to the upside, especially when the next day’s closing price is higher than the closing price of the Hammer.
A “Doji” is a price bar in which the opening price and the closing price are the same. It is considered to be an indicator of a reining-up – of indecision – and of a possible change of trend, when it appears at the end of an extended move in either direction. A Star whose opening price and closing price are the same is called a “Doji Star.” A “Bearish Engulfing” pattern occurs at the top of an uptrend, and is marked by the “real body” (i.e., the cylinder in the price bar) engulfing the real bodies of one or more previous bars. The “Bearish Engulfing” formation is, quite naturally, bearish. Its converse is the Bullish Engulfing pattern, which occurs at the bottom of a downtrend; and, obviously, carries a bullish signal.
In Candlestick parlance, gaps (“windows”) are celebrated as being generators of support and resistance. Often, a comparison of price action before and following a gap clearly reveals the power of a gap to repel prices which venture within it.
The Candles are useful in any time frame, including day trading. Although they are valuable in foretelling reversals, they do not predict the extent of a move. They are perfectly compatible with all “Western” Indicators, and the synergy which often results from the Candles and the Western Indicators used together can be remarkable. Furthermore, the Candles are equally adaptable to use in every financial market, including stocks, indexes, commodities, and Forex.
Technical analysis of Japanese Candlestick price imaging is founded on the hypothesis that price action in the financial markets is not random or mechanical; rather, that it is patterned (if the practitioner is following Elliott Wave theory), and that it is the result of human emotion in action.
There are many practitioners of Candlestick analytics who make their services available to the investing public. Some of them publish investment advisory newsletters (alternatively called “investment newsletters” or “market letters” or permutations thereof); some offer instructional and training seminars, forums, and chat rooms; some publish books; and some of them offer multiple services and products. Their observation of the Candlestick world sometimes leads to a critique of the common wisdom as propounded by the media, and to explicit review of, and commentary on, the state of the markets. Expostulation of the Candlestick analytical technique is not commonly a part of financial news programs, either in the popular printed media or on television; nor are the particulars of Candle theory often the subject of study, research, investigation, or illustration for the benefit of the investing public.
This is unfortunate, because the information which flows from these concepts could often open up new possibilities for investors and be of value to them in their decision making process.
Using Candlestick Charts In Equity Trading
Trading
in the financial markets is not a venue for the timid or for someone that is uneducated in technical analysis. One way of increasing your chances of profitability in the financial markets
is acquiring knowledge in candlestick chart patterns. Candlestick charts have a long history and it has been said that rice traders in eighteenth century Japan used candlestick charting. Applying candlestick charts to stock trading and viewing past trading history of stocks, can give the stock trader an idea of what the stock may likely do in the future.
Individual candlesticks on a stock chart are unique in shape. The body of the candle is different each day depending on whether the stock closed up or down for the day.
If the stock closed up for the day, the color of the candle will be white or light in color in most cases depending on what setting the stock trader has chosen. Also, the candle body is wide with the upper portion of the candle showing where the stock closed on the day and the bottom showing where the stock opened in the trading session. It should be noted that often times there will be thin lines coming from the bottom and top of the candlesticks, but not always. These thin lines are called shadows and show the range in which the stock traded during the day.
In the case of a shadow on the top of a white candlestick, the shadow shows the high of the day that the stock traded during the market session. A shadow at the bottom of the candlestick would show the lowest point that the stock traded during the day. When a stock has a down day, the candlestick will usually be red or a dark color, again depending on the stock traders preference. The same applies for a down day candlestick with the exception that the bottom of the candlestick will show where the stock closed for the day and the upper candlestick will show where the stock opened on the day, the reverse of a white candlestick.
Candlesticks will vary in length depending on price movement during the trading session for each particular day. On days when a stock is moving higher, the stock will show a long white body since the buying pressure pushed the stock higher. On down days where traders and investors are selling, the candlestick represents the sell off with a long red or dark candlestick. Long white candlesticks show buying pressure and long red candlesticks show selling pressure.
Short and fat candlesticks show that a war was being fought during the session between buyers and sellers with no real winner since the price did not change significantly during the session. Also, if there was no candlestick body and only a flat line with shadows on the top and bottom of the straight line, this is called a doji. In some cases the doji appears when a change of trend is about to take place with the stock. The flat horizontal line with no candlestick body represents the struggle that took place during the trading session. The shadows on the top and bottom of the horizontal line represent the high and low during the session. When the doji appears, the following trading session may show that the stock is reversing direction and going the opposite direction of the trend in previous sessions.
Learning to read and understand candlestick charts can unlock a wealth of information about stocks, revealing their past history and what they may do in the future. Reading a candlestick chart is akin to a commander of an army receiving reports from the front lines of a battle, showing the daily struggle between his army and the opposing army. On days when the candlestick is long and white, the buyers reigned supreme. On days when the candlestick is long and red, the sellers won the day. On days when the candlestick is short or non-existent, the battle was a draw with no clear winner.
Candlesticks and their patterns are powerful indicators that can help a trader decide entry and exit points when trading stocks. They can also help in removing the emotion when trading. Emotion tends to remove rational thought and usually causes the trader to make unwise decisions that create losses. Candlestick charting is a tool that every stock trader and investor should have in their arsenal.
in the financial markets is not a venue for the timid or for someone that is uneducated in technical analysis. One way of increasing your chances of profitability in the financial markets
is acquiring knowledge in candlestick chart patterns. Candlestick charts have a long history and it has been said that rice traders in eighteenth century Japan used candlestick charting. Applying candlestick charts to stock trading and viewing past trading history of stocks, can give the stock trader an idea of what the stock may likely do in the future.
Individual candlesticks on a stock chart are unique in shape. The body of the candle is different each day depending on whether the stock closed up or down for the day.
If the stock closed up for the day, the color of the candle will be white or light in color in most cases depending on what setting the stock trader has chosen. Also, the candle body is wide with the upper portion of the candle showing where the stock closed on the day and the bottom showing where the stock opened in the trading session. It should be noted that often times there will be thin lines coming from the bottom and top of the candlesticks, but not always. These thin lines are called shadows and show the range in which the stock traded during the day.
In the case of a shadow on the top of a white candlestick, the shadow shows the high of the day that the stock traded during the market session. A shadow at the bottom of the candlestick would show the lowest point that the stock traded during the day. When a stock has a down day, the candlestick will usually be red or a dark color, again depending on the stock traders preference. The same applies for a down day candlestick with the exception that the bottom of the candlestick will show where the stock closed for the day and the upper candlestick will show where the stock opened on the day, the reverse of a white candlestick.
Candlesticks will vary in length depending on price movement during the trading session for each particular day. On days when a stock is moving higher, the stock will show a long white body since the buying pressure pushed the stock higher. On down days where traders and investors are selling, the candlestick represents the sell off with a long red or dark candlestick. Long white candlesticks show buying pressure and long red candlesticks show selling pressure.
Short and fat candlesticks show that a war was being fought during the session between buyers and sellers with no real winner since the price did not change significantly during the session. Also, if there was no candlestick body and only a flat line with shadows on the top and bottom of the straight line, this is called a doji. In some cases the doji appears when a change of trend is about to take place with the stock. The flat horizontal line with no candlestick body represents the struggle that took place during the trading session. The shadows on the top and bottom of the horizontal line represent the high and low during the session. When the doji appears, the following trading session may show that the stock is reversing direction and going the opposite direction of the trend in previous sessions.
Learning to read and understand candlestick charts can unlock a wealth of information about stocks, revealing their past history and what they may do in the future. Reading a candlestick chart is akin to a commander of an army receiving reports from the front lines of a battle, showing the daily struggle between his army and the opposing army. On days when the candlestick is long and white, the buyers reigned supreme. On days when the candlestick is long and red, the sellers won the day. On days when the candlestick is short or non-existent, the battle was a draw with no clear winner.
Candlesticks and their patterns are powerful indicators that can help a trader decide entry and exit points when trading stocks. They can also help in removing the emotion when trading. Emotion tends to remove rational thought and usually causes the trader to make unwise decisions that create losses. Candlestick charting is a tool that every stock trader and investor should have in their arsenal.
Forex Day Trading Systems and Strategies
You've already made the decision to begin your career in forex day trading, but how do you go about choosing which forex day trading system to use? The good news is that choosing a strategy is the most difficult decision you have to make; the bad news is that only you can make this decision. Because you will always open and close your trades within the same 24-hour period, you must choose a forex day trading system that relies on short-term indicators. As a day trader, you should only look for forex day trading systems that accommodate your needs.
You're probably wondering why it's so important to choose a strategy for forex trading. It's very important because the temptation to chase price is so great with enormous leverage and unlimited profit potential. Without a proper forex day trading strategy, all you have to rely on is how you feel, which isn't a reliable indicator. Without one or two forex day trading systems, you won't have the resources you need to succeed. When you're just waiting and speculating on when to enter and exit the market, you're just guessing and you would be better off trying your luck at the Roulette table.
Rule #1: Keep it Simple. When you choose a forex day trading strategy, make sure you understand every aspect of the strategy. Many currency trading systems rely on reading and interpreting data before making a decision to enter or exit the forex market. If you can't read these charts or decipher them, choose a simpler strategy. Forex day trading can be profitable even at small amounts, if you have a clear understanding of your forex day trading system and you implement it correctly.
Rule #2: If You Need Help, Get it! Don't think for one second that because you need help, you won't be successful at forex day trading. Even the largest financial institutions get a help making their money, and there's no reason you can't. Unless you plan to watch the market 24 hours a day, consider using automated trading software. In addition to watching the forex market when you can't, automated software allows you to see the information the software uses to make market decisions. It's almost like having a forex mentor of your very own. Automated software will allow you to see if you've chosen an effective forex day trading strategy.
Rule #3: Stick With It. This rule seems like a no-brainer, but you'd be surprised how many day traders experience a bit of success and cast their forex day trading systems aside. The whole point of choosing an effective day trading system is to make money, and ignoring your trading strategy is guaranteeing loss. A bad day forex trading doesn't mean you've chosen a losing forex day trading strategy; it just means that you had a bad trading day. Give your strategy time to work, and understand you will have winning days and losing days. By sticking with a forex day trading system, you can make sure you have more good days than bad.
Forex Trading Traps
I wish I was reading this a couple of years ago!!
It would have saved me a lot of money!
Well it might not be a lot of money to the guys who sold me their Forex trading systems, but it was to me. I spent thousands of my hard earned and saved dollars on Forex systems that promised big results, yet did not deliver for me.
Don’t get me wrong, some of the Forex systems work; I actually talked to people who did get results from the programs.
Unfortunately I was one of them!
Yes you read it correctly I made money in my first week of trading!
In Forex you basically trade long term or short term, I was doing the short term trading (a day or less).
Yes I made good money thousands of dollars, boy was I excited I was wondering how long had this been going on. Forget the 9 to 5 job that just gets you by, that pays the bills but you don’t have anything left over to live on. I was going to make a killing, retire, work a few hours a day and live the good life!
Everything was great for a couple of weeks then I lost on a few trades, no big deal I will get it back on the next one. Because I had made good money for a couple of weeks I "knew I would get it back".
Then I began to learn what really goes on in the Forex world.
Swimming in shark infested water would be safer than playing with these guys.
Sometimes little bites, then big bites that almost break you in two, yes sir these guys know how to get at you.
This is what happened to me.
The market would be heading steadily in one direction then all of a sudden reverse and take my position out; you guessed it I would lose money. The weird thing about it was that when I did not set my stop loss it hardly happened to me. (The problem with putting a trade on without a stop loss is that you have to watch the trade all the time in case the market makes a big move against you, very dangerous.)
What was going on?
Ok there is a lesson here, the Forex broker was playing games with me he would manipulate the price to stop out my position and take my money! I found that one out too late, but you need to take note there are a lot of crooks out there in the Forex World. These guys know every trick in the book and they have been doing this for years. I started a demo account with another broker and compared the price movements and that’s how I found out that my broker was playing games.
Once I knew their tactics I could change brokers and see if the next one did the same or not put a stop loss on and spend all day in front of the computer. Well I still had to work and pay the bills so that was not going to work for me and frankly I did not have a lot of money left in the account to work with.
I learnt something else during this period; you need to take all the emotion out of your trading. I found that difficult as I had made money to start with and as I am not a robot, making money to start with turned out to be part of my downfall, it clouded my judgement.
What I needed and it is what you need!!!
An honest broker that is happy earning their money from the spread they get for each trade, their commission if you like.
A system that get better than 50% winners and takes the emotion out of the trading!
I was determined to get this Forex thing working for me; I could see the potential I just could not get it working for me.
So I tried several auto trading systems, some that only cost a $100 dollars and others that cost me over a thousand.
The real cheap ones could get a 50% or better winning trade result but only in certain market conditions. If the market was not working the way they assumed I would lose (I was only using demo accounts for these, I have learnt a little bit since I started trading Forex) and all the gains made would disappear.
The systems that cost a lot more where complicated you had heaps of setting that you had to adjust depending on things like, time of day, market trends- steady market volatile market, the currency pair that you were trading etc etc.
You getting the picture? You need to be an analytical person or plainly put a rocket scientist to get it right. I not either of them so that did not work.
Frankly it was all too hard and too costly and I needed a break.
I never gave up on the Forex market I just needed to regroup and start a fresh.
A few months later I was looking at a website that promised results in the Forex market. My first reaction was oh yea I have heard that before, yet I had a look.
These days I know what I am looking for:
• An automated system, to take the emotion out of it.
• A money back guarantee, if they don’t have one then they do not believe it works, so why should I.
• An honest broker that works with the system, it not much good having a system only to find out your broker can't or won't support it.
• A broker that has reasonable spreads, the commission the broker gets on each deal. If the spread is to much it is hard for a lot of systems to make money.
When you drop a few thousand on Forex courses and systems and then a few more on Forex trading, it prompts a lot of soul searching.
These days I know what I am looking for:
• An automated system, to take the emotion out of it.
• A money back guarantee, if they don’t have one then they do not believe it works, so why should I.
• An honest broker that works with the system, it not much good having a system only to find out your broker can't or won't support it.
• A broker that has reasonable spreads, the commission the broker gets on each deal. If the spread is to much it is hard for a lot of systems to make money.
A broker that does'nt deal against you, you win he loses- you lose he wins. Guess what happens in these situations.
A broker that does'nt deal against you, you win he loses- you lose he wins. Guess what happens in these situations.
These days I know what I am looking for:
• An automated system, to take the emotion out of it.
• A money back guarantee, if they don’t have one then they do not believe it works, so why should I.
• An honest broker that works with the system, it not much good having a system only to find out your broker can't or won't support it.
• A broker that has reasonable spreads, the commission the broker gets on each deal. If the spread is to much it is hard for a lot of systems to make money.
• A broker that does not deal against you ie you win he loses, you lose he wins. Guess what happens in this situation.
When you drop a few thousand on Forex courses and systems and then a few more on Forex trading, it prompts a lot of soul searching.
It would have saved me a lot of money!
Well it might not be a lot of money to the guys who sold me their Forex trading systems, but it was to me. I spent thousands of my hard earned and saved dollars on Forex systems that promised big results, yet did not deliver for me.
Don’t get me wrong, some of the Forex systems work; I actually talked to people who did get results from the programs.
Unfortunately I was one of them!
Yes you read it correctly I made money in my first week of trading!
In Forex you basically trade long term or short term, I was doing the short term trading (a day or less).
Yes I made good money thousands of dollars, boy was I excited I was wondering how long had this been going on. Forget the 9 to 5 job that just gets you by, that pays the bills but you don’t have anything left over to live on. I was going to make a killing, retire, work a few hours a day and live the good life!
Everything was great for a couple of weeks then I lost on a few trades, no big deal I will get it back on the next one. Because I had made good money for a couple of weeks I "knew I would get it back".
Then I began to learn what really goes on in the Forex world.
Swimming in shark infested water would be safer than playing with these guys.
Sometimes little bites, then big bites that almost break you in two, yes sir these guys know how to get at you.
This is what happened to me.
The market would be heading steadily in one direction then all of a sudden reverse and take my position out; you guessed it I would lose money. The weird thing about it was that when I did not set my stop loss it hardly happened to me. (The problem with putting a trade on without a stop loss is that you have to watch the trade all the time in case the market makes a big move against you, very dangerous.)
What was going on?
Ok there is a lesson here, the Forex broker was playing games with me he would manipulate the price to stop out my position and take my money! I found that one out too late, but you need to take note there are a lot of crooks out there in the Forex World. These guys know every trick in the book and they have been doing this for years. I started a demo account with another broker and compared the price movements and that’s how I found out that my broker was playing games.
Once I knew their tactics I could change brokers and see if the next one did the same or not put a stop loss on and spend all day in front of the computer. Well I still had to work and pay the bills so that was not going to work for me and frankly I did not have a lot of money left in the account to work with.
I learnt something else during this period; you need to take all the emotion out of your trading. I found that difficult as I had made money to start with and as I am not a robot, making money to start with turned out to be part of my downfall, it clouded my judgement.
What I needed and it is what you need!!!
An honest broker that is happy earning their money from the spread they get for each trade, their commission if you like.
A system that get better than 50% winners and takes the emotion out of the trading!
I was determined to get this Forex thing working for me; I could see the potential I just could not get it working for me.
So I tried several auto trading systems, some that only cost a $100 dollars and others that cost me over a thousand.
The real cheap ones could get a 50% or better winning trade result but only in certain market conditions. If the market was not working the way they assumed I would lose (I was only using demo accounts for these, I have learnt a little bit since I started trading Forex) and all the gains made would disappear.
The systems that cost a lot more where complicated you had heaps of setting that you had to adjust depending on things like, time of day, market trends- steady market volatile market, the currency pair that you were trading etc etc.
You getting the picture? You need to be an analytical person or plainly put a rocket scientist to get it right. I not either of them so that did not work.
Frankly it was all too hard and too costly and I needed a break.
I never gave up on the Forex market I just needed to regroup and start a fresh.
A few months later I was looking at a website that promised results in the Forex market. My first reaction was oh yea I have heard that before, yet I had a look.
These days I know what I am looking for:
• An automated system, to take the emotion out of it.
• A money back guarantee, if they don’t have one then they do not believe it works, so why should I.
• An honest broker that works with the system, it not much good having a system only to find out your broker can't or won't support it.
• A broker that has reasonable spreads, the commission the broker gets on each deal. If the spread is to much it is hard for a lot of systems to make money.
When you drop a few thousand on Forex courses and systems and then a few more on Forex trading, it prompts a lot of soul searching.
These days I know what I am looking for:
• An automated system, to take the emotion out of it.
• A money back guarantee, if they don’t have one then they do not believe it works, so why should I.
• An honest broker that works with the system, it not much good having a system only to find out your broker can't or won't support it.
• A broker that has reasonable spreads, the commission the broker gets on each deal. If the spread is to much it is hard for a lot of systems to make money.
A broker that does'nt deal against you, you win he loses- you lose he wins. Guess what happens in these situations.
A broker that does'nt deal against you, you win he loses- you lose he wins. Guess what happens in these situations.
These days I know what I am looking for:
• An automated system, to take the emotion out of it.
• A money back guarantee, if they don’t have one then they do not believe it works, so why should I.
• An honest broker that works with the system, it not much good having a system only to find out your broker can't or won't support it.
• A broker that has reasonable spreads, the commission the broker gets on each deal. If the spread is to much it is hard for a lot of systems to make money.
• A broker that does not deal against you ie you win he loses, you lose he wins. Guess what happens in this situation.
When you drop a few thousand on Forex courses and systems and then a few more on Forex trading, it prompts a lot of soul searching.
What Do Candlestick Patterns Indicate?
The Japanese candlestick, hereafter simply referred to as candlestick or candle, conveys the open, high, low, close price points for the period in question. For the sake of this article, let’s consider the daily period (using end of day historical data) which is suitable for active and short-term traders.
Candlestick patterns can embrace 1, 2, 3 or even more days. Examples of 1-day candlestick patterns include doji, hammer and harami; 2-day patterns include counterattack, engulfing and separating lines; 3-day patterns include morning star and evening star.
In general terms, the essence of candlestick pattern formations is that they indicate continuance or reversal of an up-trend or a down-trend. This is the basic answer to "What do candlestick patterns indicate?".
For example, a doji is a candlestick pattern where the open and close prices are at the same level. Following a trend in which the stock price has risen or dropped for a duration of many days, the appearance of the doji is a signal that the trend may be coming to an end, with an ensuing reversal of the stock price direction. Therefore, the trader must take the signal and observe what happens on the next trading day and react accordingly.
Let’s look at that example in more detail. Suppose a doji appears after a 10-day run-up in the price of a stock in which the trader is holding a long position. With the appearance of the doji, the trader should take note of this signal and look for a closing price below the doji level on the next trading day. If that happens, the trader would be well-advised to close the long position and take the profit because it is likely that the up-trend is in reversal progression.
This is only one example from the multitude of candlestick patterns. There are entire books and web sites dedicated to the study and discussion of candlestick patterns, what they mean, the interpretation of the candlestick pattern formations, and the trading decisions to be taken.
StockTradersPlace (http://stocktradersplace.com) provides a trend following system based on candlestick technical analysis. http://stocktradersplace.blogspot.com provides a "Stock Trading with StockTradersPlace" companion guide. Show yourself that you can repeatedly execute winning trades using StockTradersPlace as an element of your trading tool box.
Candlestick patterns can embrace 1, 2, 3 or even more days. Examples of 1-day candlestick patterns include doji, hammer and harami; 2-day patterns include counterattack, engulfing and separating lines; 3-day patterns include morning star and evening star.
In general terms, the essence of candlestick pattern formations is that they indicate continuance or reversal of an up-trend or a down-trend. This is the basic answer to "What do candlestick patterns indicate?".
For example, a doji is a candlestick pattern where the open and close prices are at the same level. Following a trend in which the stock price has risen or dropped for a duration of many days, the appearance of the doji is a signal that the trend may be coming to an end, with an ensuing reversal of the stock price direction. Therefore, the trader must take the signal and observe what happens on the next trading day and react accordingly.
Let’s look at that example in more detail. Suppose a doji appears after a 10-day run-up in the price of a stock in which the trader is holding a long position. With the appearance of the doji, the trader should take note of this signal and look for a closing price below the doji level on the next trading day. If that happens, the trader would be well-advised to close the long position and take the profit because it is likely that the up-trend is in reversal progression.
This is only one example from the multitude of candlestick patterns. There are entire books and web sites dedicated to the study and discussion of candlestick patterns, what they mean, the interpretation of the candlestick pattern formations, and the trading decisions to be taken.
StockTradersPlace (http://stocktradersplace.com) provides a trend following system based on candlestick technical analysis. http://stocktradersplace.blogspot.com provides a "Stock Trading with StockTradersPlace" companion guide. Show yourself that you can repeatedly execute winning trades using StockTradersPlace as an element of your trading tool box.
Choosing Forex Brokers in USA
The US dollar is one of the most powerful currencies in the forex trading system
. It is actually one of the most basic trading values used in this specific market. So if you are new in the market and you would like to learn the ins and outs of the US dollar trading, you might be able to boost your profits with the help of forex brokers in USA. Forex brokers serve as the middle man between two different parties-you and your buyers or sellers. They can also give you their consultancy services in the process.
You can choose to either get in touch with forex brokers in USA as a consultant or you can also choose to employ them as your trading partner. Either way, they can be an asset for you if you know how to use their influence and expertise accordingly. Two of the most important things that you need to understand when choosing your US forex broker is the forex spread which they currently use and the reputation as well as the capital they have to sustain them.
Utilizing the Forex Spread through these Brokers
A forex spread is actually the method of trading in itself. When you trade with people in the currency market, each network you have can be considered as a spread. But when you make use of forex brokers, they use a number of spread methods to make sure that you get more exposure which can also translate into more profits for them. The term is coined as spread because it makes efficient use of scanning the market for potential customers. But one thing you should keep in mind is that its different spread strokes for different forex brokers.
Forex brokers in USA may or may not publish their prices on their site. This is actually an important point to consider because it helps you understand how much profits you can gain out of them when done in comparison with spreads. There are actually two different types of forex spreads-the fixed spread which makes use of a fixed method and currency rates regardless of the trading time and the variable spread which may depend loosely on the current scene in the trading market.
Reputation and the Brokers' Capital Resources
Of course there's also the issue of choosing your broker depending on the reputation they have. Reputation is important especially if you want to expand your networks. You will also be surprised how some potential business partners may choose to not deal with you if you have a forex broker who's professional ethics are questionable. In the world of forex, it may not always be about profits.
Another important consideration is capital resources, because it gives you an idea of the rates and features you will get to enjoy through the forex broker you choose to hire. Some may be able to waive your fees and there are also those who will be able to connect you with other rising forex markets. They may end up to be a wealthy source of vital business information.
. It is actually one of the most basic trading values used in this specific market. So if you are new in the market and you would like to learn the ins and outs of the US dollar trading, you might be able to boost your profits with the help of forex brokers in USA. Forex brokers serve as the middle man between two different parties-you and your buyers or sellers. They can also give you their consultancy services in the process.
You can choose to either get in touch with forex brokers in USA as a consultant or you can also choose to employ them as your trading partner. Either way, they can be an asset for you if you know how to use their influence and expertise accordingly. Two of the most important things that you need to understand when choosing your US forex broker is the forex spread which they currently use and the reputation as well as the capital they have to sustain them.
Utilizing the Forex Spread through these Brokers
A forex spread is actually the method of trading in itself. When you trade with people in the currency market, each network you have can be considered as a spread. But when you make use of forex brokers, they use a number of spread methods to make sure that you get more exposure which can also translate into more profits for them. The term is coined as spread because it makes efficient use of scanning the market for potential customers. But one thing you should keep in mind is that its different spread strokes for different forex brokers.
Forex brokers in USA may or may not publish their prices on their site. This is actually an important point to consider because it helps you understand how much profits you can gain out of them when done in comparison with spreads. There are actually two different types of forex spreads-the fixed spread which makes use of a fixed method and currency rates regardless of the trading time and the variable spread which may depend loosely on the current scene in the trading market.
Reputation and the Brokers' Capital Resources
Of course there's also the issue of choosing your broker depending on the reputation they have. Reputation is important especially if you want to expand your networks. You will also be surprised how some potential business partners may choose to not deal with you if you have a forex broker who's professional ethics are questionable. In the world of forex, it may not always be about profits.
Another important consideration is capital resources, because it gives you an idea of the rates and features you will get to enjoy through the forex broker you choose to hire. Some may be able to waive your fees and there are also those who will be able to connect you with other rising forex markets. They may end up to be a wealthy source of vital business information.
Choosing a Forex Broker That Wont Rip You Off
At the best of times Forex currency trading can be a risky business with a huge potential for profit or loss. As a fulltime trader i have seen the best and the worst that the forex market has to offer, the dizzying highs of large wins, and the gut wrenching lows of people going bust.
You might be a forex trader yourself, or maybe you are just curious about how forex markets work, whomever you are, you need to learn how to seperate the legit forex brokers from the scam merchants. The internet has a great deal of genuine forex dealers offering quality services, it is also unfortunately infected with just as many thieves dressed up as companies who will gladly take your money and then dissapear. This fear of being taken advantage of puts a lot of people off the idea of trading forex, this shouldn't be the case.
Now there are a few key differences between stock markets and forex markets that you are going to have to learn:
1. Forex has no centralised exchange house.
2. Forex trading is 24/7.
3. Forex is a largely unregulated market.
Looking at that list, it kind of seems that the forex market is akin to a wild west town full of outlaws and gunslingers. In this market there is noone to complain to, noone who will hold your hand. So how can you find the genuine dealers amid all the garbage? Do not trust any broker whose reputation cannot be confirmed, and whose company is not tied to the forex market.
The attraction of the forex market can be overwhelming. The scent of huge profits often overpower the common sense of the average person. They enter eagerly, just waiting to invest their life savings.Lying in wait are the scammers with huge promises, they capture the new investors money, and suddenly dissapear.
The good news is, is that many genuine forex brokers do actually exist. Easy-Forex, Oanda, and many more have proven track records that justify their positions in the market. Usually if a company is small, has no affiliation to forex or a financial institution, then stay away. Also a word on looking for reviews about brokers online. You can find honest reviews on forex brokers online, however there seems to be a habit of late of competing forex companies, and/or traders engaging in negative marketing of each other. Dig deeper and you will usually find an honest answer.
So remember:
1. Validate the companies reputation.
2. Make sure they are tied to the forex legitimatly.
3. If the company is small and unheard of, stay away.
4. Finally if the broker has a proven online track record, a legitimate financial institution affiliation, and a few good reviews, give them a try.
My ultimate advice is, if unsure, invest the smallest amount you can, and find out for yourself. This is how i usually used to find brokers, and it worked for me.
You might be a forex trader yourself, or maybe you are just curious about how forex markets work, whomever you are, you need to learn how to seperate the legit forex brokers from the scam merchants. The internet has a great deal of genuine forex dealers offering quality services, it is also unfortunately infected with just as many thieves dressed up as companies who will gladly take your money and then dissapear. This fear of being taken advantage of puts a lot of people off the idea of trading forex, this shouldn't be the case.
Now there are a few key differences between stock markets and forex markets that you are going to have to learn:
1. Forex has no centralised exchange house.
2. Forex trading is 24/7.
3. Forex is a largely unregulated market.
Looking at that list, it kind of seems that the forex market is akin to a wild west town full of outlaws and gunslingers. In this market there is noone to complain to, noone who will hold your hand. So how can you find the genuine dealers amid all the garbage? Do not trust any broker whose reputation cannot be confirmed, and whose company is not tied to the forex market.
The attraction of the forex market can be overwhelming. The scent of huge profits often overpower the common sense of the average person. They enter eagerly, just waiting to invest their life savings.Lying in wait are the scammers with huge promises, they capture the new investors money, and suddenly dissapear.
The good news is, is that many genuine forex brokers do actually exist. Easy-Forex, Oanda, and many more have proven track records that justify their positions in the market. Usually if a company is small, has no affiliation to forex or a financial institution, then stay away. Also a word on looking for reviews about brokers online. You can find honest reviews on forex brokers online, however there seems to be a habit of late of competing forex companies, and/or traders engaging in negative marketing of each other. Dig deeper and you will usually find an honest answer.
So remember:
1. Validate the companies reputation.
2. Make sure they are tied to the forex legitimatly.
3. If the company is small and unheard of, stay away.
4. Finally if the broker has a proven online track record, a legitimate financial institution affiliation, and a few good reviews, give them a try.
My ultimate advice is, if unsure, invest the smallest amount you can, and find out for yourself. This is how i usually used to find brokers, and it worked for me.
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