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Donald,
Have you tried combining reversal patterns with fibonacci price target or retracement levels ?
Have you looked back through the history of a stock to see what reversal patterns it is responsive to ?
Geoff
Original Message:
-----------------
From: Donald Dalley ddalley@xxxx
Date: Wed, 07 Mar 2001 13:07:37 REBOL Time Zone
To: amibroker@xxxxxxxxxxxxxxx
Subject: Re: [amibroker] References
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<tt>
<BR>
Hello, P:<BR>
<BR>
On 06-Mar-01, server not recognized wrote:<BR>
<BR>
> What would be interesting would be to do a statistical analysis of the<BR>
> various candlestick formations and how they went in todays timeframe and<BR>
> sentiment, not Japan c16.<BR>
<BR>
The era has nothing to do with how well candlestick patterns work.<BR>
<BR>
I have only read a couple of modern studies (I don't think Nison would be too<BR>
objective at doing a candlestick study and he doesn't try in his books -<BR>
generally, he just shows when it works in his favour) and, for the most<BR>
part, they were not encouraging. Therefore, so far, I only have used<BR>
candlesticks to interpret current emotion in a market or stock.<BR>
<BR>
> Ive read of these before and they don't in several significant formations<BR>
> respond as advertised, either as strongly or at all.<BR>
<BR>
What I saw showed that accuracy depended upon the stick pattern -<BR>
some were, some were not good at predicting moves.<BR>
<BR>
When it comes to trading, candlestick patterns only represent the current time<BR>
period (say, the last 3-10 days) and the market can change sentiment very<BR>
quickly (which is to say that any trader needs to know how to exit a trade<BR>
before getting into a postion). I feel that the less information being usedto<BR>
make long term decisions leads to more misinterpretations of the data. A<BR>
candlestick pattern is only relevant until the next one is formed. That's why<BR>
I still consider using sticks as an art form. Even Steve Nison admits that<BR>
combining sticks with other indicators helps with reliability, but then many<BR>
indicators need confirmation, not just candlesticks. Choose your TA weapons<BR>
wisely.<BR>
<BR>
> I should imagine it would be hard to program into amibroker and check out.<BR>
<BR>
Having had a brief look at doing this myself, I feel that the main programming<BR>
problem is probably the relativity of the price information - what constitutes<BR>
a "long" or "short" body or tail. Candlestick interpreters exist, so it is<BR>
possible.<BR>
<BR>
The "hard" part for the user is the art of interpretation.<BR>
<BR>
-- <BR>
<BR>
---===///||| Donald Dalley |||\\\===---<BR>
The World of AmiBroker Support<BR>
http://webhome.idirect.com/~ddalley<BR>
UIN/ICQ#: 65203020<BR>
<BR>
</tt>
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