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  CANDLESTICKS = the Oriental Secret

INDEX:   MARUBOZU, SPINNING TOPS, SHORT DAYS, LONG DAYSHANGING MAN, PAPER UMBRELLA, DOJI,  HAMMERS, INVERTED HAMMER, DOJI STAR, MORNING STAR, EVENING STAR, PIERCING LINE, ENGULFINGABANDONED BABY SHOOTING STAR, EVENING DOJI STAR DARK CLOUD COVER, HARAMI, HARAMI CROSS

 

MARUBOZU    [TOP]

Marubozu means there are no shadows from the bodies

A Green Marubozu is a long green (or white) body with no shadows which indicates a bullish trend- pattern it usually becomes the first put of a bullish continuation or a bullish reversal

A Red Marubozu is a long red (or black) body with no shadows. It usually implies bearish continuation or bearish reversal

 
SPINNING TOPS    [TOP]

The Spinning Tops have longer shadow than the real body. The color of the real bodies is not very important.The pattern indicates the indecision between the bullish and bearish trends

SHORT DAYS    [TOP]

The Short Days indicate the mall difference between the open price and the close price for a trading day. Both the body and the shadow lines are very short

 
LONG DAYS    [TOP]

The Long Days indicate the great difference between the open price and the close price for a trading day. The shadow lines are much shorter than the real body

HANGING MAN    [TOP]

Hanging Man is a potentially bearish pattern, which occurs during an up trend, it is named because it looks like a hanging man with dangling legs

 
PAPER UMBRELLA    [TOP]

The Paper Umbrella appears when a small body comes with a long lower shadow. The Paper Umbrella is a strong reversal sign

DOJI   [TOP]

Doji lines are patterns with the same open and close price. There are four special types of Doji lines:

 

HAMMERS    [TOP]  

Hammer is a potentially bullish pattern winch occurs during a downtrend. It is named because the market is hammering out a bottom.

Recognition Criteria:

· The long lower shadow is about two to three times of the real body.

· Little or no upper shadow.

· The real body is at the upper and of the trading range.

· The color of the real body is not important.

(Confirmation is suggested)

 
INVERTED HAMMER    [TOP]

The Inverted Hammer is a pattern that occurs at the bottom of it downtrend it indicates a possibility of the reversal of the downtrend

Recognition Criteria:

· ·        A small real body is near the lower part of the price range

· ·        The very long upper shadow

· ·        Occurs in a downtrend

DOJI STAR    [TOP]

A Doji Star is a trend reversal pattern, which is composed of a long red body followed by a doji (a pattern with the same opening and closing price)

Recognition Criteria:

• Long red day followed by a doji

• The doji gaps down from the prior red body

*Reverse definition for Bearish Doji Star

(Confirmation is suggested)

 
MORNING DOJI STAR    [TOP]

When a downtrend market is in place, following by a Doji Star. Like the regular Morning Star, the third day will support the reversal of the trend; it is more significant than the regular Morning Star pattern 

Recognition Criteria:

• The first day is a red day, which indicates the trend of the market

• The second day must be a Doji day

• The third day is a green day and supports the reversal of the trend

MORNING STAR    [TOP]

The Morning Star is a reversal pattern, which is composed of a long Red body, a star gaps away from the Red body and a long Green body The third candle is the confirmation of the reversal it is named because it appears in the morning before the sun rises

Recognition Criteria.

· The first day is a long red day.

· The second day is a star gaps away from the first day.

· The third day is a long green body that gaps up from the prior star.

 
EVENING STAR    [TOP]

The Evening Star is a bearish reversal pattern. It's made of a long green body followed by a small body which gaps higher, which makes the price gap higher on the open, with a small range. The third day is a red body which opens lower and close much lower

Recognition Criteria:

· The first day is a long green day.

· The second day gap higher from the first day.

· The third day is a long red day and close below the midpoint of the first white day

PIERCING LINE    [TOP]

The Piercing Line is a bullish reversal pattern, which is composed of a long red body followed by a green body. It tells that the market opens lower on the opening and closes above the midpoint of the prior body

Recognition criteria:

· ·  A long red body followed by a green body

· . Occurs in a downtrend

· · The green body pierces the midpoint of the prior red body

 
ABANDONED BABY    [TOP]

Abandoned Baby pattern is similar to the family of Morning Star and Evening Star patterns. It is almost the same as Morning Doji and Evening Doji Star. The difference is the shadows on the Doji must gap below the shadows of the first and third days for the Abandoned Baby bottom

Recognition Criteria:

· The first day shall indicate the prior trend

· The second day is a Doji, which gaps above or below the previous day's range

· The third day is the opposite color of the first day and gaps in the opposite direction

     There are no shadows overlapping between the Doji and other two days 

SHOOTING STAR    [TOP]

The Shooting Star is a bearish reversal pattern; it occurs in an upper trend, which indicates that the market opens at the lows of the season, rallies and pulls back to the bottom

Recognition Criteria:

· ·A very long upper shadow

· The small real body at the lower end of the price range

· The real body gaps away from the prior real body

 
EVENING DOJI STAR    [TOP]  

An Evening Doji Star is when a Doji Star is in an up trend followed by a long black body. Like the regular Evening Star, the third day will support the reversal of the trend. It is more significant than the regular Evening Star pattern

Recognition Criteria:

· The first day is a white day, which indicates the trend of the market

· The second day is a Doji day

· The third day is black day, which supports the reversal of the trend

DARK CLOUD COVER    [TOP]

The Dark Cloud Cover is it bearish reversal pattern which a composed of a green body followed by red body It is the opposite of the Piercing Line. It tells that, the market opens above the prior day's high and closes below the midpoint of the prior green body 

Recognition criteria:

· A green body followed by a red body

· The red body passes the midpoint of the prior green body

· Occurs in an up trend

 
ENGULFING    [TOP]

 

Engulfing is a reversal pattern, especially after a prolonged trend. It has a long body that totally engulfs the prior days body

Recognition Criteria:

· The first day’s color indicates the trend of the trading day.

· The second real body should have the opposite color of the first real body.

· The second day’s body should completely engulf the previous days body.

Confirmation is suggested

HARAMI    [TOP]

 

The Harami pattern is the reverse of the Engulfing pattern. The word "harami" in Japanese means pregnant or body within

Recognition Criteria:

· A long body followed by a shot body with opposite color.

· A short body is completely within the prior day's long body.

· The color of the second candle (the baby) is not important.

Confirmation is suggested

 

HARAMI CROSS    [TOP]  

 

In Harami pattern, if the small candle is a doji the pattern is referred as Harami Cross. It is an important reversal sign, especially after a long body in a downtrend 

Recognition Criteria:

· The second day's open and close are the same (Doji).

· The Doji is in the range of the previous long day

· The long day appears within a trending market

  [TOP]

 

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