Candlesticks

This is a discussion on Candlesticks within the Technical Analysis forums, part of the Methods category; Hello Just got Nilson's candlesticks from the library (actually if anyone else is starting out and wants to save a ...

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Old Jan 29, 2003, 1:21am   #1
 
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Candlesticks

Hello

Just got Nilson's candlesticks from the library (actually if anyone else is starting out and wants to save a few quid - you'd be surprised what you can get if you can wait a couple of weeks on the order)

I'm starting to get the picture with them. They're subjective but seem very useful as another string to you bow. In the book Nilson uses them over days/ weeks/ months but not intraday. I'd be interested to hear your views on their usefulness for daytrading. Are they just as effective?

Many thanks

Dave
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Old Jan 29, 2003, 9:30am   #2
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Intra-day Candlesticks

Hi Strewthmate,

This is a difficult question to answer because it can be both yes and no. All technical indicators work some of the time and all of them fail some of the time. I have used candlesticks on an intraday basis but again you would have to decide your timescale ie should it be 1 min, 3 min, 5, 15, 60 etc. All would give a different indication of market sentiment. I did read on another forum about one guy who uses 15 minute candles to trade the IBEX, SMI and DAX futures but he didnt do it in isolation. First the three futures had to be in synchronisation with each other and he then combined it with Directional movement indicator (DMI) and rainbow moving averages. In this combination he made good money and I would guess the best way to use candlesticks is to use them with other technical indicators as a confirmation.

All The Best


Paul
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Old Jan 29, 2003, 11:55am   #3
 
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strewthmate -

If I recall correctly, Steve Nison says in his book that he found candles unreliable for time fractals of less than 11 minutes.

I've had a quick look in the book, but can't find the section where he mentions this. As I am a 99% intraday trader, this statement was particularly important to me at the time, so that's why I remember it.

But I've given up on candles, and have returned to bars.
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Old Jan 29, 2003, 12:07pm   #4
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Actually i know candles have a great following but i use bars.
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Old Jan 29, 2003, 12:19pm   #5
 
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Bars get my vote for the charts as well.

Options
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Old Jan 29, 2003, 4:24pm   #6
 
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Hi

I've used candlesticks on intraday charts(5, 15, 60min) on almost evrything from indices to commodites for last 6 years and now I can't change to any other type of chart. I think it is only a personal choice and it depends on how you can read candlesticks or bars. I personally think candlesticks will give you a quicker view (because of diference in colour ....) of what is happening. As trader333 has mentioned correctly using any chart without using other indicators might not be very good practice. I use 5,21 Simple MA on all my charts and so far (touch wood)!! %75 of my intraday trades were right.
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Old Jan 29, 2003, 8:38pm   #7
 
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strewthmate started this thread Many thanks guys. I found a bit in the book that says not to use them for less than 30mins intraday. Again Its all a big help, cheers

Dave
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