Candlestick Patterns
January 27th, 2008 . by adminJapanese Candlestick formatting for stock chart analysis involves a dozen or so reversal signals which are commonly found. Since Candlestick analysis is geared primarily to identifying reversals of major price trends which have just begun or are about to begin, the practitioner of technical analysis is always keen to find one or more of these reversal patterns. One of the most potent is the "Evening Star" formation, which is a three-bar pattern at the end of an uptdrend. The first bar will typically be a long white candle, signifying an "up" day; the second or middle bar will be a small bar or a "Shooting Star" a little higher than the first bar; and the third bar will be a long black candle, indicating a "down" day. When it forms, the technical analyst will pay attention, for the "Evening Star" has a history of predicting a significnt downside price movement after it appears.
