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Candlestick Charting For Dummies®

Book Description

Want to gain a trading edge with candlestick charts? Find them a little confusing? No worries! Candlestick Charting For Dummies sheds light on this time-tested method for finding the perfect moment to buy or sell. It demystifies technical and chart analysis and gives you the tools you need to identify trading patterns — and pounce!

This friendly, practical, guide explains candlestick charting and technical analysis in plain English. In no time, you'll be working with common candlestick patterns, analyzing trading patterns, predicting market behavior, and making your smartest trades ever. You'll discover the advantages candlestick has over other charting methods and learn the secrets of combining it with other technical indicators. You'll also get familiar with different ways to display and interpret price action, including trend lines, support levels, resistance levels, moving averages, and complex indicators. Discover how to:

  • Construct candlestick charts
  • Identify and interpret basic patterns
  • Trade in bull and bear markets
  • Work with complex patterns and indicators
  • Avoid False signals
  • Understand the components of market activity
  • Deal with bullish or bearish single-stick, two stick, and multistick patterns
  • Identify and interpret complex patterns
  • Use indicators to determine the market
  • Outperform the market in any conditions

Don't know whether to grab the bull by the horns or just grin and bear it? Read Candlestick Charting For Dummies and get it right the first time.

Table of Contents

  1. Title
  2. Contents
  3. Introduction
    1. About This Book
    2. Conventions Used in This Book
    3. What You’re Not to Read
    4. Foolish Assumptions
    5. How This Book Is Organized
    6. Icons Used in This Book
    7. Where to Go from Here
  4. Part I : Getting Familiar with Candlestick Charting and Technical Analysis
    1. Chapter 1: Understanding Charting and Where Candlesticks Fit In
      1. Considering Charting Methods and the Role of Candlesticks
      2. Understanding Candlestick Components
      3. Working with Candlestick Patterns
      4. Making Technical Analysis Part of Your Candlestick Charting Strategy
      5. Trading Wisely: What You Must Understand Before Working the Markets
    2. Chapter 2: Getting to Know Candlestick Charts
      1. Recognizing the Many Benefits of Candlestick Charting
      2. Admitting the Potential Candlestick Charting Risks
      3. Comparing Candlestick Charts with Alternative Charting Methods
    3. Chapter 3: Building a Base of Candlestick Chart Knowledge
      1. Constructing a Candlestick: A Core of Four
      2. Considering Additional Information Included on Candlestick Charts
    4. Chapter 4: Using Electronic Resources to Create Full Charts
      1. Turning to the Web for Candlestick Charting Resources
      2. Creating Candlestick Charts Using Microsoft Excel
      3. Exploring Your Charting Package Software Options
  5. Part II : Working with Simple Candlestick Patterns
    1. Chapter 5: Working with Straightforward Single-Stick Patterns
      1. The Bullish White Marubozu
      2. The Bullish Dragonfly Doji
      3. The Bearish Long Black Candle
      4. The Bearish Gravestone Doji
    2. Chapter 6: Single-Stick Patterns That Depend on Market Context
      1. Understanding Market Environments
      2. Delving Into Dojis
      3. Looking At Other Patterns: Spinning Tops
      4. Discovering More about Belt Holds
      5. Deciphering between the Hanging Man and the Hammer
    3. Chapter 7: Working with Bullish Double-Stick Patterns
      1. Bullish Reversal Patterns
      2. Bullish Trend-Confirming Patterns
    4. Chapter 8: Utilizing Bearish Double- Stick Patterns
      1. Understanding Bearish Reversal Patterns
      2. Making a Profit with Bearish Trend Patterns
  6. Part III : Making the Most of Complex Patterns
    1. Chapter 9: Getting the Hang of Bullish Three-Stick Patterns
      1. Understanding Bullish Three-Stick Trend Reversal Patterns
      2. Working with Bullish Three-Stick Trending Patterns
    2. Chapter 10: Trading with Bearish Three-Stick Patterns
      1. Understanding Bearish Three-Stick Trend Reversal Patterns
      2. Forecasting Downtrend Continuations
  7. Part IV : Combining Patterns and Indicators
    1. Chapter 11: Using Technical Indicators to Complement Your Candlestick Charts
      1. Using Trendlines
      2. Utilizing Moving Averages
      3. Examining the Relative Strength Index
      4. Cashing In on Stochastics
      5. Buddying up with Bollinger Bands
    2. Chapter 12: Buy Indicators and Bullish Reversal Candlestick Patterns
      1. Buying with the RSI and Bullish Reversal Candlestick Patterns
      2. Buying with the Stochastic Indicator and a Bullish Reversal Candlestick Pattern
    3. Chapter 13: Sell Indicators and Bearish Reversal Candlestick Patterns
      1. Shorting with the RSI and Bearish Candlestick Patterns
      2. Using the Stochastic Indicator and Bearish Candlestick Patterns for Shorting
    4. Chapter 14: Using Technical Indicators Alongside Bullish-Trending Candlestick Patterns
      1. Using Trendlines and Bullish-Trending Candlestick Patterns for Buying and Confirmation
      2. Combining Moving Averages and Bullish-Trending Candlestick Patterns
    5. Chapter 15: Combining Technical Indicators and Bearish-Trending Candlestick Patterns
      1. Putting Trendlines Together with Bearish-Trending Candlestick Patterns for Selling and Confirmation
      2. Combining Moving Averages and Bearish-Trending Patterns for Short Situations
  8. Part V : The Part of Tens
    1. Chapter 16: Ten Myths about Charting, Trading, and Candlesticks
      1. There’s No Difference between Candlesticks and Bar Charts
      2. Market Efficiency Makes It Impossible to Beat the Market over the Long Run
      3. Only a Full-time Professional Can Make Money in the Markets
      4. Technical Analysis Is Nothing More Than Reading Tea Leaves
      5. Charting Is for Short-Term Traders Only
      6. You Must Be Rich to Start Trading
      7. Trading Is an Easy Way to Get Rich Quick
      8. Candlestick Charts Require More Data and Are More Difficult to Create
      9. The Trading Game Is Stacked against the Small Trader
      10. Selling Short Is for Professional Traders Only
    2. Chapter 17: Ten Tips to Remember about Technical Analysis
      1. Charts Can Give False Signals
      2. People Will Give You a Hard Time
      3. There’s No Definite Right or Wrong Opinion of a Chart
      4. A Single Chart Doesn’t Tell a Whole Story
      5. Charting Is Part Science, Part Art
      6. You Can Overdo It
      7. Develop a Backup System
      8. Error-Free Data Doesn’t Exist
      9. No System Is Silly As Long As It Works
      10. Past Results Don’t Always Predict Future Performance
  9. : Further Reading