false signals

[Arafx]

How do you deal with false signals when trading based on candlestick patterns?

 

[Nicholasbrownie]

Manage false signals in candlestick patterns by using confirmation indicators or additional technical analysis.

 

[VasilTodorov]

i accept it that i have made mistake and i try to avoid it in future
recently i learnt more confirming indicators and i am learning new ones all the time because i know trading based on a few of them is easy and can cause problems

 

[Arafx]

i accept it that i have made mistake and i try to avoid it in future
recently i learnt more confirming indicators and i am learning new ones all the time because i know trading based on a few of them is easy and can cause problems

Continuous learning is a hallmark of successful traders, and your dedication to exploring and incorporating new indicators is commendable.

 

[bigdolly]

How do you deal with false signals when trading based on candlestick patterns?

Well you can't avoid them but their number reduces as your experience and intuition grows.

 

[Felhamand]

When the candlestick pattern shows me a full signal and I enter the position, then I oftentimes try to justify this opening, hahaha. You know, it's way better from the psychological point of view, cause if I admit that I have made a mistake, then it would be disappointing.
Once, I had such a situation, when the order was wrongly opened because I mistakenly thought that there was a flag signalized me to open bear position.
I did it, and then tried to find some other patterns which could justify my decision. And fortunately, the asset's price really went down.

 

[Balladotus]

When the candlestick pattern shows me a full signal and I enter the position, then I oftentimes try to justify this opening, hahaha. You know, it's way better from the psychological point of view, cause if I admit that I have made a mistake, then it would be disappointing.
Once, I had such a situation, when the order was wrongly opened because I mistakenly thought that there was a flag signalized me to open bear position.
I did it, and then tried to find some other patterns which could justify my decision. And fortunately, the asset's price really went down.

you got lucky, lol. usually when there are false signals which indicate a breakthrough or vice versa a pull back, folks inevitably lose such positions. as you see one pattern indicaiting one thing, and then it turns out to be just a dust in the eyes.
in your case everything went more than successful, but it's better be very cautious with flags, h&s, doubt/triple bottoms or tops, or at least back the decisions made on theese pattersn with some indicators like MACD, RSI for overbought and oversold levels or volumes. This isn't a panacea, but may be helpful, cheers!

 

[bigdolly]

When dealing with false signals in candlestick pattern trading, it's crucial to confirm signals with additional technical indicators or price action confirmation. This can include using tools like moving averages, trendlines, or volume analysis to validate the signal's strength. Additionally, implementing strict risk management measures such as setting stop-loss orders can help mitigate losses from false signals and protect trading capital.

 

[holycow]

Signals in my opinion are always hard nuts to crack so better going to news sites and doing some of own research instead of relying solely on such signals services.

 

[bigdolly]

I exercise caution by seeking confirmation from other technical indicators or price action patterns before initiating a trade. Additionally, I implement strict risk management measures, including setting tight stop-loss orders and limiting the size of each trade to mitigate potential losses associated with false signals. Finally, I continuously review my trading strategy to identify and adapt to changing market conditions, aiming to minimize the impact of false signals on overall trading performance.