What Turns Forex Indecision Candles Into Reversal Candles?

in LeoFinance •  2 months ago 

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What Turns Forex Indecision Candles Into Reversal Candles?

But forex indecision candles such as dojis are relatively usleless on their own. All they show is indecision in the market between buyers and sellers.

To turn an indecision candle into a reversal candle, we need to consider the preceding price action. Only then does the chart start to hint at what may happen to price in the future.

Take a look at the following examples:

The preceding forex price action is what makes candles patterns meaningful

If a doji forms within a downtrend, or in other words, after a series of strong bearish candles, the doji is signalling that the sellers are becoming exhausted and a reversal may be on the cards.

This is the earliest sign of the preceding bearish trend coming to an end as you are watching the sellers lose control before your eyes.

The same is also true if a doji forms within a bullish trend. Once again, that is after a series of strong bullish candles, the doji is signalling that the buyers are becoming exhausted and a reversal to the downside, may now be on the cards.

If you have any questions on what turns forex indecision candles into reversal candles, then leave a comment below and I'll be happy to have a chat.

Best of probabilities to you,


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Is that sign describe to becoming Market closing.
In that time, don't we should trade only by looking Candle?

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I only trade looking at price action and candle patterns. I don't use indicators to enter or exit trades.

I have this view because indicators are based on price. So why not just go straight to the source :)

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I've never tired Forex. I've looked into it. I prefer the safety in fundamentals that's there in buying stocks/crypto. But the education of chart patterns and candles are helpful for any market.

Thanks for posting :) I'm gonna follow you to keep learning.

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I prefer the safety in fundamentals that's there in buying stocks/crypto.

I see this point brought up quite a bit.

But when it comes to risk, there is no difference between short term trading and long term investing.

In short term trading, you have the opportunity to place a stop loss before you take a position. For example, you could risk only 2% of your account on a single trade.

Do you do this in your long term investing? If a stock/crypto you invested in starts to go down in price, do you have a 2% stop loss level, or you will hold to zero?

I like short term trading because I view it as a much safer, easier way to manage my risk on every position.

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I look for more undervalued assets that have already gone down a lot and I sell before things go too bad. But I don't use automated stop loss levels. I put a lot of focus on dividends/passive income. If I were just buying whatever that's doing well in markets and try to HODL for the long term I'd have a high chance of getting REKT.

I've done some short term trading for quick profits and I certainly get the appeal. It's just hard for me to do full time with everythin going on in my life :)

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Does crypto market follow the same trend?

Forex, crypto, stocks, bonds, sex toys - A market is a market and all asset classes behave exactly the same. They all follow the same supply/demand principles shown by candle charts.

I just prefer forex because as there is more volume traded on these markets, it means they behave more predictably.

On some of the crypto markets with low liquidity you can get some rogue trades that mess with the patterns you're trying to analyse.

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