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http://www.straightforex.com/mimages...cles/pa/1a.png
[Image 1]
The first candlestick moves down (bear dominance – red arrow), but at some point, bulls gain confidence and take control over the market (i.e. bulls felt comfortable trading at those levels) pushing the market back up (bull dominance – blue arrow). If we combine both arrows, we end up with a v shaped pattern (green arrow) with upward pressure.
Does it mean that only known candlestick patters (such as piercings, hammers, shooting stars, etc.) have either upward or downward pressure? NO. In fact, most patterns that have either upward or downward pressure aren’t known candlestick patterns. Take a look at the next image.
http://www.straightforex.com/mimages...cles/pa/1b.png
[Image 2]
This pattern is not known in the candlestick literature, but it still has upward pressure. You still see the “v” market movement.
Next time you see a candlestick pattern, try to picture it in your mind as “v” or “inverted v” pattern, this way you will train your brain to see them as price action, not just as a candlestick pattern.
2 – Level Another important concept that describes Forex Price Action, is how the market behaves at a place it already traded before. I suspect the reader already knows what we are talking about, if the market was rejected from an important level, the next time it comes close to that level, it is likely to get rejected again. And yes, we are talking about regular support and resistance levels.
http://www.straightforex.com/mimages...icles/pa/2.png
[Chart 1]
http://www.straightforex.com/mimages...icles/pa/3.png
[Image 3]
http://www.straightforex.com/mimages...icles/pa/4.png
[Chart 2]
DislikedBeyond Candlesticks: New Japanese Charting Techniques Revealed (Wiley Finance); Steve Nison (Author).
Book Description
Publication Date: October 1994 | Series: Wiley Finance (Book 56)
From the "Father of Candlesticks"--penetrating new Japanese techniques for forecasting and tracking market prices and improving market timing Steve Nison has done it again. The man who revolutionized technical analysis...Ignored