An Introduction to Candlesticks
There are two types pf ways to analysis the price of a stock , fundamental analysis and technical analysis.Fundamental analysis is used to gauge the price of a stock based on the fundamental attributes of the stock , such as price / earnings ratio ,Return on invest , and associated economic statistics. Technical analysis deals more with the psychological component of trading a stock , and is influenced for the most part on emotionalism.
The History of Candlestick Charts
The Japanese were the first to use technical analysis to trade one of the world’s first rice futures markets in the 1600s. A Japanese man by the name of Homma who traded the futures markets in the 1700s discovered that although there was link between supply and demand of the rice, the markets were also strongly influenced by the emotions of the traders. Homma realized that he could benefit from understanding the emotions to help predict the future prices. He understood that there could be a vast difference between value and price of rice. This difference between value and price is as valid today with stocks, as it was with rice in Japan centuries ago. The principles established by Homma in measuring market emotions in a stock are the basis for the Candlestick Chart analysis, which we will present in this seminar. [click to continue…]
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Most Forex traders know how to draw a channel but not many know can use the information used to create the channel to find possible turning points in the market. First lets look at the traditional channel .You would first identify a trend and draw a trend line . Next you duplicate the exact angle of that line and move it to a recent high in an up trend or a recent low in a down trend . This produces a channel. The idea is that as price approaches the upper channel line in an up trend we would expect to find sellers there and this would reverse the trend or at least pause the trend for a time. It will amaze you how often price will stop at T5 . At the very least you have an estimate of where price may retrace too. 
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