6 replies to this topic

[LongJohn]

Heck, I don't know but each major index had one of'em today ?

[Darris]

I think it means indecision, but before the Tuesday of expiry, it means a head fake before the boyz get the last bit of payday they want. The Tuesday of Expiry is usually the best day of the OPEX cycle, so a close around ES Sept contract of 1540 would give them 45 pts or about 3% from the early Friday AM low of 1495 on the same contract. FWIW. I actually think we will open on 1520 or 1528 on this contract in the morning, and either way we rally hard.

[rkd80]

They dont mean much given where they are, as they usually signify a trend reversal and the recent rally is not much of a trend. Secondly they are low/medium reliability signals.

[Rogerdodger]

What's a doji, spinning top & inv. hammer have in common?

Their signal needs to be confirmed?

[Sentient Being]

From Investopedia "A doji candlestick looks like a cross, inverted cross, or plus sign. Alone, doji are neutral patterns."

From Japanese Candlesticks.com: "Spinning Tops -- candlesticks with small real bodies, and when appearing within a sideways choppy market, they represent equilibrium between the bulls and the bears. They can be either white or black."

And the "hammer" on the uptrend is called a "hanging man". I think another up day would invalidate the hammer to an extent but it's telling you something now whether or not the message changes tomorrow.

Candles are interesting and can tell you what you most likely already know and can deduce from looking at the price action. More importantly, they are only a percentage game like any other TA tool.

I'm starting to think that the only ones that can make money trading are those that have an edge. A way of looking at things that very few people have caught on to. Once they start writting books about your "edge"....it's value is most likely limited. And candles have been around a long time and there are many books out that talk about them.

[ecpinto]

A doji which appears after 6 or more continuous up days on volume is a sure sell signal.....no confirmation needed. A spinning top implies a loss of momentum...Usually if you have an overbought stochastic or some other oscillator...you can use it to go short. An inverted hammer is as sure a sign of a top as you can get...It means that the stock opened near its lows...rallied and then closed near its lows...a sure sign of a lack of buying power...

[TTHQ Staff]

Basic, but there.

Candlestick Patterns