how to understand the reliability of a bull candle?

This is a discussion on how to understand the reliability of a bull candle? within the Technical Analysis forums, part of the Methods category; I let the market consolidate, lengths of this differ. Then I observe a Support / Resistance line above the consolidation. ...

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Old Aug 16, 2012, 7:04pm   #16
 
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Re: how to understand the reliability of a bull candle?

I let the market consolidate, lengths of this differ. Then I observe a Support / Resistance line above the consolidation. I wait for market to penetrate the resistance. I buy in. I use a SMA under the market as my stop loss. When it is crossed and stock closes underneath, I get out. My program screens for some MAs I choose to be in order and the SR line to be crossed upwards. That is my in. Out of 500 Nasdaq stocks I screen an average of 1 a day hits. As many as 5 have hit same day. I only use daily bars. When my exit MA is crossed going down I get out so I don't predict anything, the trend is changed, the MA shows this. I'm done with guessing, it's too expensive.
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Old Aug 16, 2012, 10:29pm   #17
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Re: how to understand the reliability of a bull candle?

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Originally Posted by numbertea View Post
I let the market consolidate, lengths of this differ. Then I observe a Support / Resistance line above the consolidation. I wait for market to penetrate the resistance. I buy in. I use a SMA under the market as my stop loss. When it is crossed and stock closes underneath, I get out. My program screens for some MAs I choose to be in order and the SR line to be crossed upwards. That is my in. Out of 500 Nasdaq stocks I screen an average of 1 a day hits. As many as 5 have hit same day. I only use daily bars. When my exit MA is crossed going down I get out so I don't predict anything, the trend is changed, the MA shows this. I'm done with guessing, it's too expensive.
i understand this, i think. So i have to wait for a break in support and resistance and based on the direction of the break, i go that way. May i have a refresher on what an SMA and MA's is (im searching right now anyways), what do you mean by "When it is crossed and stock closes underneath", and what you mean by "I choose to be in order and the SR line to be crossed upwards" (what do you mean by crossed is the real question. are you just referring to the candles going up and down?)


also on EUR/USD i noticed that it goes up or down dramatically every night/morning between 12 pm and 7 am (1 -3 am being more prominent). What are your thoughts on that? (just thought i'd asked, im assuming your trading in this - just curious on what runs through your head when you see that)
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Old Aug 17, 2012, 5:07pm   #18
 
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Re: how to understand the reliability of a bull candle?

By SMA and MA here I mean simple moving average. While trying to learn the basic linguistics of stock trading I found the Investopedia website an indispensable resource.
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Old Aug 17, 2012, 5:26pm   #19
 
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Re: how to understand the reliability of a bull candle?

normally, you can tell how reliable a bull candle is by watching what happens after it occurs.
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Old Aug 17, 2012, 7:26pm   #20
 
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Re: how to understand the reliability of a bull candle?

if you set your chart background to black,
and then change the settings for Up candles to black,
and for Down candles to, err black,
you will find that Bull candles are very reliable
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Old Aug 20, 2012, 1:14am   #21
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Re: how to understand the reliability of a bull candle?

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Originally Posted by dotcom View Post
i thought there would be some form of reliable prediction, not just some randomness
of course there is.
and no, moves are not based on fundamentals. you should realize that early on in your trading career.
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Old Sep 3, 2012, 9:35pm   #22
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Re: how to understand the reliability of a bull candle?

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Originally Posted by dotcom View Post
how does one know that a bull candle is reliable to enter?
You cannot use the candle stick pattern as a standard alone. Not every Bull candle is worth taking i.e. will result in a subsequent rise in price. There are a number of things to consider such as: does it stand out?, is it at a swing low. etc
But there is no short answer - experience will tell you which Bull candle is reliable.

Good luck learning
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Old Sep 4, 2012, 9:34am   #23
 
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Re: how to understand the reliability of a bull candle?

Quote:
Originally Posted by dotcom View Post
i thought there would be some form of reliable prediction, not just some randomness.
Well, yeah. Andrew Lo from MIT demonstrated statistically significant non-randomness in security prices. Published a book about it. So, TA can work.

Its all about context.. a bull candle is simply one bar... You can look at volume on and/or surrounding the candle.. As someone mentioned is the candle happening at a support level. You have to have entry, exit and money management figured out-> how will you trade your bull candle setup -> which give a huge number of possible systems that have each have different performance metrics, etc - all from one damn bull candle base. Many variables you're original post doesn't address

Rathcoole is hysterical lol
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Old Oct 19, 2012, 3:46pm   #24
 
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Re: how to understand the reliability of a bull candle?

I have see review of bull candle just one time. Then i was just shock bcoz there was i saw just numbering movement. It was very difficult for person to understand easily. I know day by day they can understand. But usually i don't like the format of bull candle, that's unreliable.
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