Candlestick Investing

Candlestick Investing

When it comes to investing in stocks, forex or options trading nothing beats candlestick patterns.  When you become proficient at candlestick investing and recognizing these simple yet advanced patterns you learn to identify clear and concise areas for entry and exit that could not be identified otherwise.

You can start with just the Top 10 Candlestick Patterns, learn those, learn to recognize them and begin to understand the underlying meaning behind the pattern.  Don’t look at the pattern as a picture but rather look to what the pattern means and why it means what it means.  Only then will you develop expert insight.

When it comes to candlestick investing there are a few hard fast rules you can learn right now.  First, and definitely one of the most important candlesticks, is the Doji candlestick. Look for Doji’s at the top of a trend and you will often find the end of an uptrend.

Here’s a shot of an up-trending stock where after a long move up doji patterns start to appear.  The key is that price had a nice run up THEN the doji appeared signaling the end of the trend.

 Candlestick Investing

There is one problem with the image above and that is price did not reverse.  It did hesitate and pull back a bit, but did not reverse. Did the doji fail us? No we just didn’t find the right SET-UP. Lets take a look at another set-up using the same doji pattern.  Remember candlestick investing requires a thorough understanding of confluence.  This is where we use multiple tools that point to the same probability.  Like this.

The first PROPER step in identifying a bearish reversal worth paying attention to identify either a bearish prevailing trend or set a proper trigger.  Let the doji NOTIFY you but don’t trade on that alone.

Take a look…

Candlestick Investing

Candlestick Investing High Odds Trading

Notice here we are down trending and on strength we get a doji. Here is a more ideal place for bearish entry. As you can see this would have been a nice trade.  Applying candlestick investing tricks to the previous chart we would have let the doji identify the potential reversal and then set a proper trigger like this…

Candlestick InvestingAs you can see there are many ways to profit from candlestick investing. the key is understanding what truly is a high odds trade set-up and what is not. Use the form above to download and learn these patterns for free.

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