Candlestick patterns trading strategy

Japanese Standard is a trend strategy based on identifying candlestick models.

The signal to open a trade is the appearance of a candlestick in a different color that covers previous candlesticks.

How do I read candlestick signals?

Trading will require only the candlestick chart with a time frame of 5 or 15 minutes.

Switch to the Japanese Candlesticks chart. The price chart is now a series of alternating red and green candlesticks of different sizes.

Quotes take the form of columns at equal time intervals. If an asset price has risen over the selected period, the candlestick is colored green; if it has fallen, red.

If several candlesticks of the same color form one after another, you have a trend.

What candlestick models are saying?

What candlestick models are saying
By watching both how the candlesticks’ color changes and their size, you will get a signal to open trades.

In this strategy, you need to learn to identify two candlestick models.

The first is when 1 candlestick appears and its body covers the previous candlestick(s) of the opposite color.

For example, the body of a red candlestick covers the bodies of green ones. This indicates the possible start of a downtrend.

If a green candlestick is covering the length of red ones, upward price movement is most likely to follow.

The second model is when not 1, but 2 candlesticks are covering the body of a candlestick of the other color.

For example, when 2 small red candlesticks have covered 1 green one. This indicates that the downtrend will likely continue.

Or when 2 candlesticks cover the previous red one, this indicates the probable continuation of an uptrend.

What are the features of a tick chart?

The tick chart is one of the ways to show fluctuations in the value of the asset (quotes).

It shows every price change or a tick.

Please note: a tick is any movement of the asset, in any direction and for any number of points.

For example, the quotation has increased by one point — it’s a tick. Then the quote has suddenly dropped 5 points down — it is also a tick.

A tick is a mandatory price change. If the value of the asset does not change, the tick may not appear.