CANDLESTICK ANALYSIS.

*Candle stick analysis is the modified version of bar charts with colors denoting Bears with red body and Bulls with green body.
*Its real time application is for short term positional trading .
*FORECASTING DURATION : only for two or three days to a maximum of one week.
*CONDITIONS FOR BULLISH ENGULFING :
1. The recent fall in price should be witnessed.
2. The bullish body should cover the previous days bear body.
3. There should be significant volume should be noticed during the formation of engulfing.
We can create a long position after the bullish engulfing pattern is formed with significant volume.
*CONDITIONS FOR BEARISH ENGULFING :
1. The recent uptrend should be witnessed.
2. The bullish body should cover the previous days bear body.
3. There should be significant volume should be noticed during the formation of engulfing.
We can create a short position after the bearish engulfing pattern is formed with significant volume.
*PIERCING PATTERN CONDITIONS TO QUALIFY :
1. The body should cover the previous day’s low.
2. The current day body should cover at-least 50% of previous body.
3. The upper tail should be small.
We can make a long position provided a significant volume is noticed during the formation of piercing pattern.
*DOJI: If the day starts at one point and tried to goes up and down and closed at the same start point in a same day, then this is called a Doji
Doji with high volume indicates trend reversal.
* MORNING AND EVE STAR : Morning Star: After significant price fall, if doji appears with green body and high volume, it can be identified as morning start.
Evening Star: After significant increase in price if doji appears with red body and high volume, it can be identified as evening star.
*HAMMER AND HANGING MAN(refer pts mentioned blw)