Technical Forex Traders and Japanese Candlestick Charts

[TracyL]

Technical Forex Traders and Japanese Candlestick Charts
By Tracy Lenyk

Successful technical traders read charts like doctors read x-ray files. What do charts do and why are they important? Charts tell a story. The charts tell traders where the market is going. The question is; do we want to buy or sell the currency as compared to its counterpart.

Forex traders need to understand and know how to read Japanese candlesticks.


When a currency opens it shows you the bottom, (Bull side). Then it travels down in value and then back up, passing the opening value and closing above the opening value. This is now the process of the candlestick.

For a bear market the opposite is true. So currency moves up or goes high and then moves down and closes below its opening value. This the bear market

If, we are selling currency we want to see a lot of bear candles and if we are buying we want a lot of bull candles.

Price fluctuation will happen in a certain time frame. When you are looking at a 240 chart you are looking at all the transaction that took place within a 2 minute and 40 second window.

Japanese candlesticks are telling us a story. In the forex market there are 4 candlesticks to be concerned with, Engulfing candle, Doji stars, Independent candles (tweezers) and exhaustion candles.

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