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Candlestick analysis Forex
Japanese candle stick charts is one of the types of graphics that show the movement of currencies, on the basis of which to make a forecast for further market development. Like other types of charts, candles are built with respect to two coordinates, the vertical denotes price or so-called Tiki, and the horizontal represents time. Candle chart is very similar to bar charts, but many traders believe that candles are more convenient for perception.
Candle stick charts are rectangles which are colored in specific colors, usually white and black, depending on the situation that occurred in a certain period of time. If the candle is white, so was the growth of the market and the upper side indicates the closing price and the lower the opening price. If the candle is black in color, it means that there was a falling market and the opening price is above the closing price. If the body of the candle draw a horizontal line, it means that the price of the opening and closing of the candle level. In many programs, graphs, monasterace color candles as they wish, however there is a General rule that a positive candlestick is painted with the background color, and falling - the outline color of a candle.
The thin vertical line above the candle body and under it are called upper and lower shadows of the candles. These lines indicate what was the maximum and minimum peaks value of a currency over a given period of time.
A graph that displays forex candles, not to view the detailed dynamics of the market, but only shows the range of price fluctuations over a certain period of time. However, on the basis of this graph type is built from a lot of analytical strategies for the trading of currencies. The correct approach to the analysis of the chart you can clearly determine when to enter the market and a time when you need to get out of it.
Of really working strategies based on the analysis of candlestick charts, there are three main.
1. 3 Bar Buy / Low Set Up is a classic, proven strategy
2. 50% of the previous candle – a simple, but, nevertheless, in many cases quite an effective strategy.
3. High Low is also pretty simple, but quite effective strategy.
After examining and testing these types of analysis, it is realistic to start making money on Forex wound. But do not stop on just one kind of graph, because the wider your knowledge, the less loss and more profit.
|Category: Forex | Added by: (29.10.2017)