Japanese Candlesticks

[ubiestmea]

In a recent thread a number of posters recommended Steve Nisson’s book, Japanese Candlestick Charting Techniques, I see he is giving a free webinar next week. I know nothing about candlesticks and neither claim they work or call BS on them, this will be my first exposure to candlesticks.

It’s sponsored by a forex site and geared toward forex trading, if anyone else is interested in checking it out:
http://www.fxticker.com/index.php?page=SteveNison

[JJay1231]

Candlesticks are definately worth learning, BUT there are so many different patterns and only a handfull are really all you need. I recommend a book by Stephen Bigalow called "High Profit Candlestick Patterns", and it's probably the only book you need on the topic (I have 4) and it covers the most effective 12 patterns. Personally I only use The morning/ evening star pattern which includes a gap from the previous day, and a doji star followed by a gap, and they provide enough opportunities to keep me busy.

good luck

[john kane]

you can use americanbulls.com or britishbulls.com which solely use the japanese candlestick system and tell you whether to buy confirmed, sell confirmed, hold, wait, buyif and sellif.

i have no connection with the owners or anything, just ive found it very useful.

ill be buying a candlestick book though, the Bigalow one sounds good.

[JJay1231]

Bigalows books are good but I ignore his use of the "Stochastics" indicator and "moving averages" or any other western indicators with candlesticks for that matter. I believe combining the 2 does more harm than good. Generally candles show reversal and continuation patterns well before indicators do, so it almost defeats the purpose of even having indicators with candles. The only time I will look at indicators with candles is to identify any divergence with the MACD Histogram or RSI.

[sebbb]

I'm a bit of a newb here.

I read Nison's book's first part this weekend. I kind of life it, seems like TA suits my character better than FA.

I subscribed to the webinar, thanks to the OP.

I'll try Bigalow's book once I'm done with Nison's and Murphy's (Technical Analysis of the Futures Markets).

Jjay: what you say seems a bit weird to me since Nison seems to advise using candlesticks in combination with western methods

John Kane: seems like a good idea that you educate yourself rather than follow blindly advice from a website

[JJay1231]

it comes down to personal preference. I rarely use indicators as I look for "reversal" candlestick patterns mainly, and they give me signals of a possible revarsal before any indicator. I will however look for divergence between the MACD and RSI indicators to add more weight to the signal once in a while.

if there is a doji star after a downtrend followed by a bullish "gap" up day, Im not going to look at indicators to see if I should get in.

Buy a few books and experiment and test them out and see what works best for you. Every trader has their own trading style.

But remember, the Japanese rice traders who used candlestick patterns 400 years ago never had indicators.