candles

  • Sun, Mar 20, 2016 - 07:45am

    #3

    davefairtex

    Status Diamond Member (Offline)

    Joined: Sep 03 2008

    Posts: 3132

    count placeholder

    candles

Steve-

I'm in the middle of doing a bunch of statistical analysis on candlesticks – I'm trying to answer the question "given this candle print in this context, what are the chances of a reversal based on today's market context."

My code tells me the crude oil candle on Friday was a spinning top, forming the second part of a "bearish harami", not a shooting star.  Definition of shooting star says the length of the upper shadow must be >= 2x the body.  Shooting stars can be unpleasant, bearish harami not so much.  I think the idea is that failed rally needs to be a bit more exciting for it to be a stronger candidate for reversal.

Bulkowski (one site I'm using to help me in my work) suggests that a bearish harami is a continuation pattern 53% of the time.  http://thepatternsite.com/HaramiBear.html

Here is the def of "shooting star":  http://thepatternsite.com/ShootingStar.html

Prior to my recent work, I have been a bit sloppy in identifying the various candle patterns!  My code is now keeping me in line…