Review – Profitable Candlestick Trading: Pinpointing Market Opportunities to Maximize Profits

After a gap of ten years when the book’s opening edition, “Profitable candlestick Trading Pinpointing Market Opportunities to Maximize Profits” was launched in the market, the second edition of the book is now launched.

Written by Stephen W. Bigalow this has been hailed as a fresh and enhanced version from the earlier book.

This book is a thorough and clear presentation of the continuation and reversal patterns. This is quite same to the ideas in Steve Nison’s work.

This book excels as a catalogue. However on closer inspection this is more than a catalogue.

The author has combines candlesticks with stochastics and volume.

Profitable Candlestick Trading: Pinpointing Market Opportunities

The author guides the readers through some profitable trades. He then goes on to explain the false signals and how they can be eliminated by the individuals.

He gives an outline of the various trading schemes and describes vividly the ways in which one can use candlesticks to improve Elliott wave analysis.

Bigalow in the book however describes two patterns which have performed well over the last ten year period.

The left/right combo is the first pattern which he describes in the book.

This leads to a long description by the author. He relates how a doji in an oversold condition is followed by an engulfing signal.

On the downside the doji who is followed by the bearish engulfing signal is able to produce a strong change in the price movement.

The second pattern is known as the belt hold. The bullish belt hold pattern is one in which the candle has a down ward trend. It moves to a higher point for the rest of the day.

The bearish belt hold is however just opposite of this. This is formed from a gap in the existing upward rising trend.

The opening is high and it backs off after some time for the rest of the day.

Profitable Candlestick Trading: Pinpointing Market Opportunities to Maximize Profits (Wiley Trading)

The author also goes into the T-line and he moves ahead of the candlesticks. This is the 8-period exponential average on the move.

This is derived when one of the students of the author initiated a way to buy and sell rules using the candlesticks, the moving average and the stochastics.

The student showed how a candlestick buy signal during the oversold condition can lead to the high probability result.

This upward trend continues to be in progress until there is an appearance of a candlestick selling signal and there is a close below the T-line.

 The author has made no attempts in systematizing candlestick trading. The reader who wants to know about the kind of results that they can achieve will have to do their own back testing.

This is not an easy job with the software packages available in recent times.

One has to read the book and finish it to understand the various nuances about which the author has made a point in his book.

One must however apply the things that they have read in the book so that they can derive the maximum benefits from it.

Profitable Candlestick Trading: Pinpointing Market Opportunities to Maximize Profits (Wiley Trading)

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