Practical Exercise No5
July 21, 2015 at 12:52 pm #1464Dave GregsonParticipant
Just added some charts showing bearish engulfing candles
bullish engulfing candles and some MA Crossovers with the DORs for the 16/07/15,
20/07/15 and the 21/07/15
DaveJuly 21, 2015 at 8:56 pm #1472Rich FittonKeymaster
Hi Dave, looking good 🙂July 23, 2015 at 9:59 am #1476
Here are my screenshots showing engulfing candles and ma crossover. Any feedback welcome.
On the GBPUSD chart, on the first circled area – is this still classed as an engulfing candle?
On the GBPJPY from the 22nd July on the first circled area – the red candle wicks are quite long but has a short body – does this still count as an engulfing pattern?July 23, 2015 at 10:00 am #1481
…contd – one more crossover chartJuly 24, 2015 at 2:48 pm #1489Rich FittonKeymaster
Your examples are looking good. On the GBPUSD chart it’s not a ‘classic’ engulfing pattern, but this is where a bit of artistic license can come in on your trades as your confidence and experience grows.
Instead of being caught up in the semantics of whether this bar is a engulfing pattern or whether that bar is a ‘morning star reversal’ etc. (if you go on some of the trading forums you’ll see people arguing like mad over the ‘correct’ definition!) you just need to take a step back and think about what the price action is telling you. In this case that one bullish 15min bar shows strong buying coming in after a pause & hold on the DOR and then and goes on to undo all the selling on the two prior bearish bars. So your analysis might tell you “yes, this is a good buying opportunity,” even though the textbook engulfing pattern is not quite there.
On your GBPJPY, the red bar – the one with the long wick – shows a strong potential reversal pattern in itself (think how the buying power reversed the selling that took the bar to its lows) and the bullish engulf bar coming straight after it suggested the buyers were certainly the dominant force.July 25, 2015 at 3:06 am #1492
Thanks Rich, having your comments on these exercises is extremely useful!
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