CANDLESTICK SIGNALS

Why I Love Candlestick Charts

I came across this stock the other day and I just became fascinated with the rice
action in this stock! It a"so reminded me why I am such a bi# fan of cand"estick
charts!
Take a "ook at the fo""owin# chart and fo""ow a"on# be"ow!!!
$% This stock was in a nice utrend unti" the bi# #a down with a wide ran#e
cand"e on massi&e &o"ume! These tyes of mo&es are institutiona""y dri&en and
often i#nite new trends!
'% After a short two(day bounce) a bearish en#u"fin# cand"e forms! Engulfing
candles are my all time favorite candlestick pattern. *hi"e other cand"estick
atterns show a s"owin# of momentum) engulfing candles tell you for a fact
that the other side has taken control of the stock.
+f course this can chan#e on the fo""owin# day but at that oint in time) you ha&e
confirmation that a re&ersa" is takin# "ace!
+&er the ne,t se&era" days) narrow ran#e cand"es de&e"o that stay near the
bottom of that en#u"fin# cand"e! This shows weakness on the art of the buyers!
If they can-t e&en mo&e the stock &ery far into the rior days ran#e) then you
ha&e to assume that se""ers wi"" take contro" of the stock a#ain! And they did!
.% After a fi&e day ra""y another en#u"fin# cand"e forms! *e know for a fact that
se""ers ha&e com"ete"y o&erwhe"med the buyers! Those who bou#ht into this
ra""y are now /uestionin# their decision! 0ear crees in and the stock tanks!
1% This stock first showed u on my scan with the doji at 2''!33! I thou#ht) 45ey
this mi#ht be a #reat shortin# oortunity!4 *hi"e a doji te""s you that a s"owin# of
momentum has occurred) it rea""y doesn-t si#na" a re&ersa" in and of itse"f! It te""s
you that a re&ersa" could haen! It didn-t!
So now we ha&e an interestin# ra""y! It started out innocent enou#h with just a
cou"e of narrow ran#e cand"es) but now it has e,anded into a stron# ra""y!
Greed is be#innin# to set in as the dai"y ran#es e,and!
This stock has retraced too much of the rior swin# for me to consider shortin#
this stock now) but at the &ery "east this stock wi"" conso"idate! It may re&erse!
5eck) maybe another en#u"fin# cand"e wi"" de&e"o!
So) whi"e a re#u"ar o"d bar chart #i&es you the same information) a cand"estick
chart aints ictures of human emotions! That-s why I "o&e cand"estick charts! As
a discretionary trader) I need these ictures to make #ood trades6