Candlestick Patterns When Combined With Technical Indicators Can Be Powerful!
If you are into day trading or swing trading then you must know two things, technical analysis and candlestick charting. Both of these tools are a must if you want to become a winning trader no matter what market you like to trade or what contracts or instruments you want to trade.
It doesn't matter. Candlestick charting has become highly popular with the traders over the last two decades.
For a trader, one of the most important thing to know is whether a trend is about to reverse itself or continue.There are a number of candlestick patterns ranging from simple to complex that can be used accurately in predicting trend reversals and trend continuation.
Now, when you combine these candlestick patterns with technical indicators, you can obtain highly accurate trading signals that can triple your profits.
There are many candlestick patterns. There are simple candlestick patterns like the Doji, Hammer, Shooting Stars, Hanging Man etc. Then there are complex candlestick patterns like the bearish and bullish Engulfing Patterns, the Three Soldiers Patterns and so on. As a trader, you need to confirm the trading signal. So when these candlestick patterns appear, it is an important signal that either the trend is about to reverse or it will continue. You can use technical indicators to confirm these signals that will make them even more accurate.
As a trader, you must have used moving averages, relative strength index, stochastics, average directional index, moving average convergence divergence and so on.
To tell you truth, in the beginning, you might get overwhelmed by the number of technical indicators that are available. What you need to do is to choose only two or three and then master them. One should be a trending indicator and the other should be a ranging indicator. I think, mastering three indicators is the best for you. Don't go for more than three indicators.
Now why you need to master these trending or ranging indicators? These technical indicators can give you signals on the trend reversal as well as trend continuation. These technical indicators can tell you when the market is overbought or oversold. Candlestick patterns also give signals on trend continuation and trend reversals.
So if you have been only trading with technical indicators, it is the best time to master candlestick charting and combine the two and see the power!
No candlestick pattern or technical indicator is used alone in getting a trading signal. But when you combine both you can get a confirmed signal verified by two different methods that tells you about the trend reversal or the trend continuation! This is the time to enter or exit a trade!
Article Source: FxTradingStock.com
About the Author
Mr. Ahmad Hassam has done Masters from Harvard University. Master these highly profitable Candlestick Patterns with this FREE 82 page PDF Candlestick Guide. Download this profitable Magic Breakout Forex Strategy by Tim Trush and Julie Lavrin FREE.
by: Ahmad Hassam
Total views: 37
Word Count: 462
Date: Thu, 30 Sep 2010
Publish/Share this article
To use this article on your site click here to get the HTML code
Rating: Not yet rated
Login to vote
Related Articles
Tips On How To Profit In Virtual Stock TradingLet's Choose A Forex Broker.
Some Tips On How To Forex Trade Online To Know
Stay Away From Requotes In Forex.
Helpful tips for Finding the right Forex Trading Program
Forex Currency Trading Software program -- Pick the Proper 1!
Forex Trading Strategies - What To Do When You Loose
Currency exchange Robot Trading Systems - Get the Full Benefit!
