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TA Series Part 4: Dual and Triple candlestick patterns

TA Series Part 4: Dual and Triple candlestick patterns

In the previous post, I have discussed about candlestick’s history, its inventor as well as a few common single candlestick patterns. As a continuation of the previous post, I will now discuss about the dual candlestick patterns as well as triple candlestick patterns. More advanced patterns will not only indicate turning signals, but also show trend confirmation that can give investor more confidence to take action in the market. At the end of this post, you should be able to identify most common chart patterns, and read between the candlesticks.

Dual candlestick pattern

Tweezer top and bottom

     

Tweezers do look like those things that you use to pluck your eyebrows. These patterns have the following characteristics:

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TA Series Part 3: Candlesticks

TA Series Part 3: Candlesticks

Now that we have understood what is Technical Analysis and why do they work, let’s us now jump right into the most important basics of Technical Analysis, which is to understand what are candlesticks. To put it simply, candlesticks are basically the individual boxes (can be green-red or black-white) that made up a chart. They represent the open, close, high and low price of a particular instrument within a specific time period. In this post, we are going to learn about the origin of candlesticks, its basic patterns and how to interpret them.

Where it came from

The Japanese candlesticks or what is commonly known as candlesticks have come a long way since it was first used around 1600. It was first used by a rice trader in Japan called Homma. During the period between 16th and 17th Century, many of Japanese areas are engaging in a civil war, which is why many of the candlestick patterns are named after military terms.
It was not until the last 2 decades that candlesticks start to popularize the investment world. After an extensive 3 year long research done by Steve Nison, he finally managed to popularize candlesticks in the West through its initial publication of “Japanese Candlesticks Charting Techniques”, published in 1991.

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