Technical Analysis Articles –
Introduced by George Lane the stochasic process is derived from the idea that as prices increase, closing prices are often closer to the upper end of the price range. Conversely, in downtrends the closing price tends to be near the lower end of the trading range.
In 1935 a book was published for sale to investors at an incredible price of $1500. That book was Profits in the Stock Market by H.M. Gartley. On page 249 Gartley describes a chart pattern, “Practical Use of Trend Lines”, which we now call the AB=CD Pattern.
Technical analysis to predict price action in the financial markets is just another factor used to put the odds in favor of the trader. But relying on any single indicator to provide signals for a trade is not advisable. Since indicators derived from price action are lagging indicators, they confirm a signal only after the move has been initiated.
Brought to you by: CandleStickShop.com Step 1 – Pull up a Weekly chart of the stock after the market closes for the week (Friday after close). Step 2 – Look for THREE WHITE SOLDIERS against MINOR PRICE RESISTANCE, and/or against the declining Major Moving Average (10 MA, 20 MA, or 50 MA) on the Weekly
An unusual reversal pattern on a Japanese Candlestick chart defined by a gap followed by a Doji, followed by another gap in the opposite direction. The shadows on the Doji have to completely gap above or below the shadows of the first and third day. See Bullish Abandoned Baby