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How to correctly use Doji candlesticks to spot a reversal?

  • #41
  • Jun 14, 2014 2:40pm Jun 14, 2014 2:40pm
So there I was, finally ground down to the point of giving up with XP.
The genii inside knows exactly what is wrong, but the world has moved on to Windows 8.1.
Who gives a stuff about XP?
Well.... when you have as many machines as I have a massive upgrade is an expensive operation.
...actually it is more time consuming, nothing ever happens quickly with a Windows machine - except for BSOD.

So my trading machine ...which came with VISTA installed, and was backdated by me to XP for reliability, has finally come to move on.
Re-instating the old OS (disk swap) I discovered that it has been 4 years since I abandoned Vista.
My FF belligerence, news-reading, eBay surfing (did I say that?) has been running fine on this laptop using Vista Business - mostly, so I am giving it a try on the trading machine. What could possibly go wrong!

As I sit here waiting for update 40 out of 176 to install I stumble across a subject dear to my heart - the useless doji.
Actually it is far from useless, it is a good signal that you should pay attention to the chart.

Quoting Magix
PS... Sorry to hijack your thread... <expletive deleted> ...
Had I been signed-in I would have missed a great many pearls.
Without intending to sound sycophantic, if I could give you a vouch then I would.
I shall go back and read page-1 in a couple of days to make sure that it all sank in.
Cathartic seems an apt word.....
Carbon-Dioxide: the gas of life! https://youtu.be/ttJBdr6eBuo
  • #42
  • Jun 14, 2014 4:05pm Jun 14, 2014 4:05pm
Quoting Exodus
{quote}So this is what a doji really is, it is a congestion zone; an exhaustion if you will. What you don't know is whether it is temporary or final! Spot a doji on a 4hr chart? Zoom-in to 15-minutes, or 5-minutes, and look at what is there. Does that look like a flag? Even the Japanese have said (according to Herr Nison) that some modern indicators are a useful supplement to candle analysis. I read that as an admission that candle patterns on their own are incomplete, and after many hours in front of a screen you will agree. It is a long road...

Bingo it's as simple as that, that's all it is. But H4 Doji are very powerful expecially if they are created from the new york session. You have a currency running out of steam and you have another picking up steam. Most Dojis on most chart are created by 2 other pairs most of the time,that your not looking at. A doji created on a EURUSD chart, that was caused buy yen buying has always have a higher probability of going your way, because when the EURUSD goes long because of USD selling pressure, the EUR buyers, who thought it was a EURO move join the move and follow YEN, and it goes in cycles, from time frame to currencies. The problem with most is that they never investigated which pairs move the market the most. But good post. That's good info on dojis.
Being a trader is lonely, but being a great trader is lonelier still
  • #43
  • Jun 14, 2014 7:27pm Jun 14, 2014 7:27pm
Quoting saneblane
{quote} Bingo it's as simple as that, that's all it is. But H4 Doji are very powerful expecially if they are created from the new york session. You have a currency running out of steam and you have another picking up steam. Most Dojis on most chart are created by 2 other pairs most of the time,that your not looking at. A doji created on a EURUSD chart, that was caused buy yen buying has always have a higher probability of going your way, because when the EURUSD goes long because of USD selling pressure, the EUR buyers, who...

I can't help feeling a little embarrassed for you here...


Quoting saneblane
"From what you've said, I be inclined to start believing that doji would be better used as confirmation of other forms of analysis." That's good thinking, I've seen Dojis everywhere fail, by itself it really doesn't say much, for instant in an uptrend, price action can go down, and come back up, and the trade can resume going long, or the candle can go up then close back down, and head south, the most interesting thing is that even if it close down that doesn't mean that the market is weak either. It takes skills to know the...
They work...they don't work...they only work on charts where there are 2 pairs that you are mostly not watching creating them...On The H4 charts...

Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #44
  • Jun 14, 2014 7:30pm Jun 14, 2014 7:30pm
Quoting albchr
Just a quick post to the OP about Doji's and why Magix mentioned the 4H is perhaps the single most useless TF of all the charts. I agree. Taking the May 8th EUR/USD example I've read here. The first is a daily chart marking that May 8th candle. The 4H and 1H charts follow. As you can see, if we who have different broker times were looking for a 4H Doji, I guess we're out of luck on this trade signal. The strong SR above (Blue line on daily) is evident to everyone regardless of broker time, I hope. And you can see I have it marked on the others as...
Great post Chris!

Quoting Exodus
So there I was, finally ground down to the point of giving up with XP. The genii inside knows exactly what is wrong, but the world has moved on to Windows 8.1. Who gives a stuff about XP? Well.... when you have as many machines as I have a massive upgrade is an expensive operation. ...actually it is more time consuming, nothing ever happens quickly with a Windows machine - except for BSOD. So my trading machine ...which came with VISTA installed, and was backdated by me to XP for reliability, has finally come to move on. Re-instating the old OS...

Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #45
  • Jun 14, 2014 7:38pm Jun 14, 2014 7:38pm
Quoting Magix
{quote} Great post Chris! {quote}
  • #46
  • Jun 14, 2014 8:30pm Jun 14, 2014 8:30pm
Magix...would you mind sharing your indicator that draws the large time frame candles over the smaller time frame?....or tell me what to search for to find myself. Thanks in advance.
  • #47
  • Jun 14, 2014 9:17pm Jun 14, 2014 9:17pm
Quoting Jbomb21990
Magix...would you mind sharing your indicator that draws the large time frame candles over the smaller time frame?....or tell me what to search for to find myself. Thanks in advance.

Attached.
Attached File(s)
File Type: mq4 LargeTimeFrame.mq4   4 KB | 557 downloads
Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #48
  • Edited 11:27pm Jun 14, 2014 10:15pm | Edited 11:27pm
Quoting Magix
{quote} I can't help feeling a little embarrassed for you here... {quote} They work...they don't work...they only work on charts where there are 2 pairs that you are mostly not watching creating them...On The H4 charts...
Hahaha, you don't have a clue what I am talking about. The reason why I don't use a chart is because i have all the information, that's happening on everytime frame all the time, and who is buying or selling, and which currencies move more freely. And this is updated live, not next week or next year Live.Why are you commenting on things you don't understand, you wouldn't even know what is going on if you saw it live anyway, like you do everyday. Sigh, stick to your support and resistance and trade blind with your RR, I am way beyond that stage. Look at the chart below maybe you might learn something. If you check that Doji you would see that the USD was weak against every single currency that I mentioned, is this a coincident? Or is something going on here that you don't understand, every single currency major was strong against the USD, heck most probably didn't notice this was going on since their heads are stuck on one chart. Oh and that is a EURUSD by the way.

This is correlation trading live before it even happen. i trade order flow without a chart, it's something I thought myself after studying the market for years and learning what and why price moves, those shit you talk about are basic. Stop spamming the man's thread, you don't know shit about the subject. Go study the chart and see for yourself know it all, you want to know about the Holy grail trade? It happens when the USD is being sold against every pair, something that most didn't even think was possible. A trade like that doesn't happen often but when it does, it's at least a 90 percent trade, go check it out April 4th, every single pair was in a uptrend against the USD. These are the kinds of trade I look out for, among other things. You wouldn't know a thing about that anyway

If you want to talk about Support/Resistance go make your own thread, no body want to hear that basic stuff, the guy ask about a doji and all you do is talk shit. Where do you people come from, can you even trade?
Attached Image (click to enlarge)
Click to Enlarge Name: Save as reversal doji.jpg Size: 239 KB
Being a trader is lonely, but being a great trader is lonelier still
  • #49
  • Jun 14, 2014 11:04pm Jun 14, 2014 11:04pm
Quoting saneblane
{quote} Hahaha, you don't have a clue what I am talking about. The reason why I don't use a chart is because i have all the information, that's happening on everytime frame all the time, and who is buying or selling, and which currencies move more freely. And this is updated live, not next week or next year Live.Why are you commenting on things you don't understand, you wouldn't even know what is going on if you saw it live anyway, like you do everyday. Sigh, stick to your support and resistance and trade blind with your RR, I am way beyond that...
My friend, Magix clearly knows how to trade and is actually trying to help.

If you are speaking to order flow, then it will comply with S/R, though I am not sure as it is not clear.
Attached Image
The world you desire can be won. It exists.. it is real.. it is possible..
  • #50
  • Jun 14, 2014 11:12pm Jun 14, 2014 11:12pm
Quoting Mr. Scott
{quote} My friend, Magix clearly knows how to trade and is actually trying to help. If you are speaking to order flow, then it will comply with S/R, though I am not sure as it is not clear. {image}
Hey Scott, S/R is good I know that, it wasn't my argument to begin with, the issue is the guy Hijacked the thread and started talking about S/R, when clearly the OP wanted to hear about a Doji. He's a dipshit who took over a thread about a subject he doesn't know about. He can go start his own thread about S/R if he wants to "teach" so badly.
Being a trader is lonely, but being a great trader is lonelier still
  • #51
  • Jun 14, 2014 11:23pm Jun 14, 2014 11:23pm
Quoting Magix
{quote} Attached. {file}
Thank you very much!
  • #52
  • Jun 14, 2014 11:28pm Jun 14, 2014 11:28pm
Keep fighting and dont forget to go more in details to how both of you are trading. Thanks.
  • #53
  • Jun 14, 2014 11:28pm Jun 14, 2014 11:28pm
Quoting saneblane
{quote} Hey Scott, S/R is good I know that, it wasn't my argument to begin with, the issue is the guy Hijacked the thread and started talking about S/R, when clearly the OP wanted to hear about a Doji. He's a dipshit who took over a thread about a subject he doesn't know about. He can go start his own thread about S/R if he wants to "teach" so badly.
Well Magix does have his own place.

But anyway, what is a doji? A place of indecision. A place where momentum has stalled.

So, when is it significant? At S/R. (and other reasons that we may have for building a case for reversal or continuation)

How do we tell? Drum down to lower tf . Get aggressive or wait for confirmation.

Don't know as it is late again, but Magix might have been saying something similar.
The world you desire can be won. It exists.. it is real.. it is possible..
  • #54
  • Jun 15, 2014 1:03am Jun 15, 2014 1:03am
Quoting saneblane
I have been trading about a year now and I learn one thing in forex.
Quoting saneblane
i trade order flow without a chart, it's something I thought myself after studying the market for years and learning what and why price moves,
Quoting saneblane
But Like I always say, I don't know anything so take everything I say with a grain of salt
Quoting saneblane
is there anyone here who trades order flow, I want to start a thread but not to teach anyone because I am still learning, but rather to bounce around ideas.
Quoting saneblane
all you do is talk shit. Where do you people come from, can you even trade?
Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #55
  • Jun 15, 2014 1:35am Jun 15, 2014 1:35am
lol

This thread looks interesting..........
Wherever you go, there you are.
  • #56
  • Jun 15, 2014 3:39am Jun 15, 2014 3:39am
Quoting Ponzi Jr
The occurrence of a Doji candlestick is often regarded as a sign of a potential reversal. However, other times it is actually just a brief period during which bulls/bears are catching their breath - after which the initial trend resumes. What other signs are there that a doji signifies that a reversal is about to occur?
When we see #falsebreak .........
not euphoria follower
  • #57
  • Jun 15, 2014 3:58am Jun 15, 2014 3:58am
I am going to be honest with you guys.....if you think you going to make a living at trading just knowing a few simple patterns, candle formation or by only learning something that have probably work for somebody else...then you are going to get very disappointed with the results...trading is extremely difficult and it will take years before it is mastered, let say about ten years if you have nobody that will guide you........because there is a lot of rubbish (marketing) out there...and it will take many years before you realise that.....once you realise that....then you need to deal with yourself......juice...that is going to be the difficult bit, many will never deal with that......

My advise? If you are very passionate about it invest in technicality, read, reread and study the Technical Analysis of Stock Trends by edwards/magee, it is all there....not more is needed, will that be enough? No way, you need to apply it in your time frame, because your style need to fit with your personality......Well this will be the difficult bit as I mentioned before, few knows much about his own personality, how are you going to find a style that relates to it if you have not any idea about yourself? Are you following me?

Then you have to understand that what works now does not necessary going to work next, the market is efficient, if one pattern or idea works all the time the market will not be efficient.....following me? Patterns work, they fail and their failure fails and you need to be prepared for that...
Once all this is brought to your attention, then and only then you will start to realise the real structure of the market, bulls, bears, side bulls and side bears, market movers and those few time when it is worth it to risk your money for a greater return....

Do not invest in BS, invest in yourself.... if you decide that the 3 minutes time frame is the one that reflect most your personality, print out every day a daily chart for the last 3 months and see where you can could have taken advantages of it, just trade one instrument for the time being, the book mentioned above it will only work when you have acquired all the concepts combined with your own flair, the yourself it is the one that will make the difference.....

Now do you think trading is easy?......
Wherever you go, there you are.
  • #58
  • Jun 15, 2014 5:04am Jun 15, 2014 5:04am
Quoting Ponzi Jr
The occurrence of a Doji candlestick is often regarded as a sign of a potential reversal. However, other times it is actually just a brief period during which bulls/bears are catching their breath - after which the initial trend resumes. What other signs are there that a doji signifies that a reversal is about to occur?
you go to steve nison and you say to him this is bullshit.
  • #59
  • Jun 15, 2014 6:09am Jun 15, 2014 6:09am
Quoting milam
...if you think you going to make a living at trading just knowing a few simple patterns, candle formation... then you are going to get very disappointed with the results...trading is extremely difficult and it will take years before it is mastered, ..... study the Technical Analysis of Stock Trends ......... Now do you think trading is easy?......
Trading could be easy. It entirely depends on you.

With all due respect, I beg to differ your statement.
(1) A few simple patterns could be profitable for a long term if only you deploy proper money management (SL, TP).
(2) Technical analysis is a double-edge sword. All profitable traders know the basics of it, but not all of them rely on it for entry. Again, a few simple patterns can override the hard-learned TA.

Having said the above, I am not criticizing your trading style. If it is profitable, it is great and an absolute victor.
  • #60
  • Edited 7:02am Jun 15, 2014 6:31am | Edited 7:02am
Quoting Forexgogo
{quote} Trading could be easy. It entirely depends on you. With all due respect, I beg to differ your statement. (1) A few simple patterns could be profitable for a long term if only you deploy proper money management (SL, TP). (2) Technical analysis is a double-edge sword. All profitable traders know the basics of it, but not all of them rely on it for entry. Again, a few simple patterns can override the hard-learned TA. Having said the above, I am not criticizing your trading style. If it is profitable, it is great and an absolute...
Sorry, they make you believe that.....your post confirms to me that you have not any idea how the market works.....Trading is not easy and till you understand that you will have not any chances........

To enter the market and make money you have to prepared......your words are only cliches....I have heard them millions of time.......yes MM is important....but if you have not skills to deal against the best, MM only will not help.

Sorry is the truth...
Wherever you go, there you are.
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