The Wait and See Patterns While most patterns on the candlestick chart can show you possible up or down trends, certain patterns can also indicate when traders should slow or stop trading and wait for clearer market signals. These are called wait and see patterns; two of the best known are the inside range and [...]

Reading Candlesticks The appearance of the candlestick body and its shadows provide a lot of information about the state of the market and where it’s going. The length of the candlestick body shows where the majority of the trading took place. A long body suggests that the market is trading heavily in one direction, while [...]

Two Day Reversal Candlestick Patterns Another type of candlestick reversal pattern is the two-day reversal pattern. Again, this kind of reversal signals that the general direction of the market is changing, but the change occurs over two days. These patterns appear at an extreme up or down trend in the market, so many traders watch [...]

One Day Candlestick Reversal Patterns One pattern that traders frequently look for is a candlestick reversal pattern. You may already know that a reversal indicates a sudden change in the market direction. For example, a bullish reversal means that the market may move up from a down trend while a bearish reversal indicates that the [...]

Sakata’s Five Methods Before Homma developed candlestick charting, traders in his hometown of Sakata, Japan followed a set of rules and methods called Sakata’s Constitution. Homma later used a set of patterns in this constitution, called Sakata’s Five Methods, as the basis of his candlestick charting principles. Today, these patterns still help traders identify simple [...]

Controlling Risk, Cutting Losses and Newsletters What’s your Problem? Let Me Guess! You’re not alone if you feel you need to improve your trading. As many as 90% of would be traders find they can’t make a profit and give up in the first six months of trying. The general issues you face are the [...]

Backtesting We’ve been through the reasons that a black box system is no way to trade, and why high yield accounts managed by people may not work out either. Then a cautionary tale about the risks of setting stops on the market, and a look at one of the latest technical tools that is starting [...]

Groundbreaking Techniques Ichimoku Charting You may not have heard the term Ichimoku – it’s been used in Japan for about seventy years, but the West has only just discovered it. It literally means at a glance, and that describes how the Ichimoku chart is for the trained eye. For the untrained eye, it seems terribly [...]

Losing to Succeed? You have to consider each situation and your method of trading to see whether you should put your stop loss order in the market. Whether or not you do, you should always know the price point at which you can safely assume that the trade has failed, and should cut your losses. [...]

The Truth About Setting Stops You may have heard some conflicting information about setting stop losses, and be wondering what to do. Some people say to always set them, others say never do that, and sometimes you’re supposed to figure out for yourself if you need stop losses set. Why You Need Stops The reason [...]