Is a candle that opens and closes at the same price bullish, bearish, or neutral?

Is a candle that opens and closes at the same price considered bullish, bearish, or neutral?

Thanks

depends on the location of the candle, timing, and length of the wicks on either side. As well as relation of the wicks to the candles prior.

The candle itself is called a doji. It means there was indecision between buyers and sellers during this time period. As the above poster said you analyze the doji in patterns.

http://www.candlesticker.com/

If your candle started a bit earlier, or closed a bit later it probably wouldnt look the same, so why place so much trust in an arbitary representation of price.

You are being fooled by randomness.

Good God! Are you deliberately trying to antagonize the locals? You could get hung drawn and quartered for that kind of talk. Candles represent price (in the past), and Price ACTION is EVERYTHING!!

We all know that doji's/pin bars work perfectly as reversal signals at least 50% of the time, and the other 50% they signal continuation patterns. That's gotta be worth sitting up and taking notice of, by anyone's standards.

It tells you that price is in exactly the right place at exactly the right time and does not need to go anywhere.

That is the opposite of indecision.

Forget the bullish, bearish, neutral thing. All it's telling you is wait and see what the next candle comes up with. If it appears at the top or bottom of a move, then it will need a confirmation candle before any decision can be taken. In short, don't make any decisions based on a doji....wait to see if a reversal pattern forms.
Hope this helps.

A bar that opens/closes on the same price is called a dojo.

Dojo are great indicators in telling you that a trend may be exhausted and about to reverse. Dojo is where Bull/Bears are fighting for control of the market.

For example: trend has been up and the next candle is a dojo which means the bears are now in the market and are fight the bulls in an attempt to reverse the market.

Dojo = a hestation perod to where both parties are now fight for control. In a lot of cases a dojo will the the indicator to show a price reversal is near but never enter the market on that because, just because you see a dojo does not mean a price reversal will happen Sometimes the market will continue in it's original direction or a sideways market will appear. So not all dojos prompt reversals.


This pic shows a dojo that does prompt a reversal in price

Visit this link for more info on candlestick patterns: http://www.candlestickshop.com/glossary/index.html If you want to learn about dojos and stars.

My 2 pips on your question. The doji candle that you describe can mean several things, depending on where it is located in relations to the previous candles, and the length of the tails. It is generally thought to mean that there is indecision in the market, but I like to think of it as a place where the market is in equalibrium. As you may have already observed, the market often does not stay in equalibrium for very long, so expect the market to move quickly after a doji. In addition, a doji on a higher compression (day or 4H) can often be more important than one on a lower compression (ie, 5M or 15M).

As for the idea that the market being random and therefore the doji is perhaps a random event: if you study the charts, you will know how silly that idea is.

I think the poster who said you were being fooled by randomness was talking only of the candles rather than the market as a whole. Saying the shape of candles is random is entirely different to saying the entire market is random......and candles are completely random from what I can see.

The idea that a candle on a higher time frame is more important than a lower time frame is the silly notion here I think. Let's look at the straight forward example of a daily candle. When does your broker's day start? Do you have a Sunday candle, and what time does your Sunday candle start? If you have a Sunday candle, it means your Monday candle will look entirely different to another broker who doesn't have Sunday candles. Each broker's Monday candle will have started and ended several hours apart. The daily candles will look completely different on every different broker in different time zones around the world. What may look like a Doji in one broker, could look like a full bodied candle in another. Are you suggesting that candles that only appear the way they appear to a minority of traders around the world are more important than the ones that all look the same regardless of time zone?

Again with 4 hour candles. Your 4 hour candle may start and end 1 hour before mine, and therefore the shape and appearance of each will be significantly different or even completely opposite. The only people who see the same 4 hour candle as you, are the other people using the same time zone broker as you. Do you really think that holds more importance over what the vast majority of other traders in the world are looking at (and they will all be seeing different candle shapes)?

Candles really are nothing more than random expressions of what the price has done in the past. Random in the fact that they are arbitrarily formed based on the time your broker starts. Look at a broker (1) that starts on Sunday and has a one hour candle before the time rolls over to the Monday candle. And then compare to a broker (2) who's time zone for market open begins exactly at Monday and therefore has no Sunday candle. Broker 2's first 4 hour candle begins at market open. Broker 1's first 4 hour candle begins an hour later (remember his first hour of the market was assigned to the Sunday candle). There is now a 1 hour difference for their 4 hour candles, so you can imagine how different they will each look. While one will show you a doji, the other may be a strong full bodied bullish or bearish candle. You'll be seeing something completely different to me, and interpret the market completely differently. And yet the market has done exactly the same thing in the same period, and price has moved identically for both of us. Do you really think it's sensible to add more importance to your candle even though the rest of the world is seeing something entirely different?

Everyone bangs on about how much more important 4H and above is, without really thinking of what the time frames mean in reality. Sound bites regurgitated from one person to the next without any thought or investigation as to why, or what it means.

What does a 4H or any other time frame candle actually represent? It tells you where price was 4 hours ago, where it was 4 hours later, and the highest and lowest points it reached in-between. It tells you nothing else, especially of what the price was actually doing in that time. The price could very well have spent 3 hours and 59 minutes at the very top extreme of the candle, and then in the last minute dropped back down to it's open price, and you see a doji and interpret that how you will. My candle ended an hour before your's and therefore the same period of time in the market is represented in my candle as a full bodied up close.

Candles really are arbitrarily formed from one broker to another. If you are going to give weight and significance to them, shouldn't you at least use a time representation that is the same for every trader around the world....i.e. 1H and below? At least that way you know everyone is seeing the same thing.

I know the likes of Steve Nison make some very attractive representations of how good candles are at telling you what the market is doing or likely to do next, but have they got any statistical evidence to back up the claims? Do doji's indicate a reversal or a continuation? Mostly what you'll hear is they could go either way, "you have to use other signals and wait and see". Isn't that a bit of a cop out? The market could go up or down! Really? Hardly seems special to me. If the candles were so great, why doesn't Steve Nison actually use them to trade his way to Billions instead of doing seminars teaching other people to risk their money on patterns that could signify the market may go up or down?

If people want to use candle patterns to aid or even control their trading that is fine and can be perfectly profitable. I'm generally of the opinion that you can use anything to make money in forex, and there is no right or wrong way. What works for one person won't work for the next. That's the nature of trading so good luck to everyone in finding what works for them. But it's wrong to present one method as being fact without offering any evidence or even a reasonably intelligent opinion to back it up. Telling someone that 4H candles and above are more significant and important than others, at the very least needs to be offered with a reason behind the statement.

If you study the charts properly, and not just let your eye be drawn to the obvious swing highs & lows, you will see that doji's appear at turning points, in the middle of continuations moves, and in areas of consolidation in equal numbers.....therefore (in my opinion) random and meaningless. If anyone can offer hard statistical proof to the contrary, I will be more than happy to admit I am horribly wrong, publicly apologise for being so abrupt this morning, and I will immediately look in to changing my entire trading strategy.

Been trading the euro and cad this morning and just now getting to read up on FF stuff.

Wow, was surprised at the long reply to my little post. Let me expand just a bit on my post. First, I have not conducted an expansive study of charting software or systems, so I will defer to anyone here who has done so. However, on the four charting systems that I have used, a doji seems to say the same thing, ie, if the doji has small tails it means the market may be in equalibrium. The significance of the time frame is simply this: a doji on the 5M chart says the market has been in a state of equalibrium for 5 minutes, and a doji on a 4H chart says the market has been in a state of equalibrium for four hours. It's up to you to figure out the significance of this candle, as it is presented to you in what ever charting software you use.

Good trading everyone.

A doji (or spinning top, comparable somewhat to the even more indecisive/balanced one-pip candle) does meet its own definition of being a point of indecision or balance, and can be used within a larger purpose.

definition
There's ways around the problem of TF's being off in calling a certain number of minutes to making a reliable doji.

The first answer would be, find a doji on a higher TF and then look at the lower-TF candles within it to find a more exact definition of balance of a doji type from a selection of those 'inner' candles. If that doesn't satisfy due to a sparsity or deviance of data, compare the candles to those of another broke r's.

An imperfect doji or an average of two or so candles that together resemble a doji, say one that is more a hanging man or gravestone, may be a better fit to be a doji depending on the group of candles it is with, the broke r, etc.

use, alone
If a doji actually did something on its own that is immediately useful every time as a pivot or similar, that would be nice. Here offers statistics you talk of.
Barely convincing ones, perhaps.

use, in a group
So I look for the local area's sense of balance or indecision and match it to the single doji candle found.
Once recognized in and of itself, a doji can be used in a wide variety of ways, candles being in constant flux and, to me, meant to represent such. Constant flux is not random, though it can seem close and does not easily give provable answers.
It may be included with a collection of other doji in a big area, somewhat balanced area, for example, or be anchoring a highly imbalanced, smaller area.
How the chart uses a doji and its definitional significance depends on the chart's area
and sometimes also on the data given (which, with a group of candles from one broke r, I consider okay to use since, generally, the same large-order customers are using that broke r.)