Charting 201
Double Top and Double Bottom Reversal Patterns
The next sets of patterns are very important and are the easiest to spot. The double top and bottom form when the stock tries to retest old support/resistance levels and fails. Look at these examples of a double top and…
23Jul2006 | Stephen Oakes | 0 comments | ContinuedOptimal Moving Average Positioning
Moving averages come in three kinds known as simple (SMA), weighted, or exponentially smoothed averages. An example of a 50-day moving average would be the last 50 days of a stock’s closing price added together, and then divided by 50.…
23Jul2006 | Stephen Oakes | 0 comments | ContinuedFlag and Triangle Continuation Patterns
A stock’s price can do two things. It can either reverse or continue in the same direction. Continuation patterns are made up of candlesticks and indicate great buying opportunities. In this chart we will take a look at a few…
22Jul2006 | Stephen Oakes | 0 comments | ContinuedCongested and Continuation Patterns
Congested and consolidation patterns are easy to spot. When a stock trades and moves in an irregular pattern, it is said that the stock is congested. We do not want to a stock when it is behaving in such a…
22Jul2006 | Stephen Oakes | 0 comments | ContinuedSpinning Tops and High Wave Candlesticks
The last groups of candlesticks shown below are named “spinning tops” and “high wave candlesticks.” Candlesticks that show a smaller real body and obtain either color are known as spinning tops. They do not act an indicator, but tend to…
22Jul2006 | Stephen Oakes | 0 comments | ContinuedLong-legged Doji and Gravestone Candlesticks
In this graph we will look at a “Long-legged Doji” and the “gravestone” patterns. The long legged doji has very long upper and lower shadows and usually shows up around the tops of trends. This is a complete sign of…
Candlestick Star Patterns
The next group of patterns is made up of three candlesticks that include “stars.” These patterns are very strong signs that a reversal is coming. These candlesticks must appear at the top or bottom of a trend. The star must…
Harami and the Harami Cross
The “harami” pattern is made up of a long real body that engulfs the smaller candlestick. This can be associated to a parent with their child. The longer body must occur first, followed by a shorter body. The colors do…
Candlestick Reversal Patterns
The next sets of candlesticks shown below are known as the “hammer” and the “hanging man.” The lower shadows attached to the bodies should be twice the length of the real body itself. These candlesticks will have no upper shadow…
22Jul2006 | Stephen Oakes | 0 comments | Continued-
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