![]() ![]() This easy to read and use reference book follows the same format as the best-selling Encyclopedia of Chart Patterns. Never before has a book combined a comprehensive list of candlesticks with a statistical review of their performance.until now. Encyclopedia of Candlestick Charts takes an in-depth look at 103 candlesticks, from identification guidelines, to statistical analysis of their behavior, to detailed trading tactics. Here is the slick marketing message: Candlestick patterns are footprints of the smart money and deciphering those footprints properly can bring traders and investors riches. It gives me an edge over other traders that do not have such information. That is the kind of information you can get from my book, and that is how I put it to good use. After a bumpy start, the stock moved up in a straight-line run to 187.70 on Novembefore pausing for a few days. ![]() ![]() A downward target is 139.84 with a 53% probability of reaching 130.28. The upward target is 183.39 with a 61% probability of reaching 191.33 (page 93). The book says (page 89) that the candle acts as a bullish reversal 66% of the time. For Apple stock (AAPL) on November 13, 2007, I found an above the stomach candle. That information is in my book, and it is well worth the cost of it. ![]() Before I make a trade, I look at the probability of the candle acting as a reversal or continuation, and how far price can be expected to move once I am in the trade (based on the candle height). If you then see price begin to falter, like it is thinking of reversing, you can exit the trade ahead of everyone else. Looking up the candle in the book, you read that it acts as a bearish reversal 79% of the time (page 308), and that 74% of the time (page 312) price reaches its price target (the height of the candle projected downward). Imagine that price has been trending upward for 5 bars and you see a bearish engulfing candle pattern. Before I get to the slick marketing message, let me give you a few examples of how I use the information in my candlestick book. ![]()
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