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Chapter 9, Part V. Double Deuce – dual candlestick patterns.

Discussion in 'Complete Trading Education- Forex Military School' started by Administrator, May 26, 2011.

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  1. Administrator

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    Part V. Double Deuce – dual candlestick patterns. [​IMG]
    Commander in Pips: Let’s continue with patterns, so today we will study candlestick patterns that come from two candles. We will talk only about the major patterns. The minor patterns are not so important, so you can study them by yourself in Steve Nison’s books “Japanese candlesticks” and “Beyond Candlesticks”.

    Pipruit: Yes, I think that we can shift to them, besides, single-candle models were not as complicated as I thought initially.​

    Commander in Pips: The first model is “Dark Cloud Cover”.

    [​IMG]

    Here is what it looks like:

    [​IMG]

    Dark Cloud Cover consists of two candles. The first one should represent good strong up candle with small shadows (even without them) – this should be just a strong up candle with obvious price increasing price action. Due to market upside momentum, the next trading period (black candle) opens above the highs of the white candle. But then, bearish pressure totally overcomes the bullish move and negates all the Bull’s work to push prices higher. The perfect Dark Cloud Cover assumes that the closing price of the black candle should be below the middle of the white candle. The open price of the black candle should be above the highs of white candle, as on the picture.

    This is a bearish reversal pattern and usually it appears after some upside move, on tops or under resistance levels. It gives us early notification that market has reached some resistance and could bounce to the downside or even reverse for the long-term.


     
    #1 Administrator, May 26, 2011
    Lasted edited by : Feb 19, 2016
    Hamza Samiullah and fran alvarez like this.
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