Japanese Candlestick Analysis Forex
The Japanese have been using candlesticks to trade commodities since the 17th century which makes them the first and most basic form of Technical Analysis. Candlesticks remain popular even today as they are a visually appealing way to monitor price data. The body of a candle is created by the difference between the open and close (also referred to as “the real body”), while the thin “shadows” on either end of the candle mark the high and low over that period (also referred to as “wicks” or “tails”). A dark or red candle means the close was below the open, while a white, green or blue candle shows the price closed higher than it opened. A doji is a single candlestick that looks like a cross and forms when the opening and the closing prices of a security are identical. A Doji demonstrates market indecision but under the proper circumstances can indicate a reversal. There are 2 popular variations of the doji, the Dragonfly Doji and the Gravestone Doji.
A Dragonfly doji is a doji which has a long lower wick and the body near or at the top and is usually a bullish candlestick. A Gravestone Doji oppositely has a long higher wick and the body is at or near the bottom and is usually a bearish candlestick.
A Tweezer Bottom is a chart pattern consisting of 2 candlesticks. The first one is a bearish, registering a new lows (might be a S/T high), however, the next one is a bullish candlestick that after testing the last candlestick’s lows moves directly higher.
For a Tweezer Bottom formation to be valid that 2nd candlestick has to close above the 50% retracement of the first one. 
This is consider a reversal formation but statistically hasn’t proved to be such a strong reversal indicator as theory suggests.
Reversal Patterns; One of the most significant goals of technical analysis is to identify changes in direction of price action. Because candlesticks give insight into what the market is thinking, one of the most useful aspects of candlestick analysis is its ability to suggest changes in the sentiment of the market.
Forex News And Analysis
Good evening traders! In the last article, you learned and how to read them on the chart. forex dial indicator is not redrawn Today we will introduce you to the basics of candlestick analysis in the Forex market. In today's article, you will receive complete information about what patterns of candlesticks are available (single-hole, two-, three-multiple, and multiple-light combinations), reversal patterns of candlestick analysis, and which of them are found more often on the chart, and how to use them in trading. Also see our independent with real reviews by traders. Three rules of candlestick analysis There are three rules of candlestick analysis, you need to know for every trader: • The larger the candle body, the higher the probability that price will continue in the same direction. If closed with large white candle, the price will go up and if a large black candle, then down; • If the candle has a shadow shorter than the other, the higher the probability that the price will move in the direction of the short shadows.
Candlestick Analysis
For example, if on top of a candlestick 'tombstone', it is a very high probability that price will reverse and fall down; • If the price went in the expected direction, it will go in the opposite direction. For example, the price were to fall after the appearance of the candle 'tombstone', but instead she rose, then, most likely, it will continue its upward movement. Single-candlestick Japanese candlestick patterns There are more than 70 Japanese candlestick patterns, but it makes no sense to apply them all. We selected for you the most reliable and the most frequently occurring patterns of candlestick analysis: 1. Inverted likefrom the (weak pattern) and shooting star (strong pattern). These patterns share one candle with a small body and long upper shadow. The difference is that 'shooting star' is on top of the market, and the 'Inverted hammer' at the bottom of the market.