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Corey,
I chart all futures and equities in candlesticks...hey, we're talking supply
and demand here. A candle is just a graphic representation of the
accumulation and distribution. Certain one, two and three day formations
are more reliable than others. It's similar to classic chart analysis. If
Edwards and Magee didn't absolutely "ape" these 400 year old candle
patterns...there would be a problem (island reversals/morning and evening
stars; outside days/bullish and bearish engulfing patterns; etc. etc.)
Fear and greed drive the markets and these repeating "psychological"
behavioral patterns repeat in most fair markets.
Can one make a living solely on monitoring candles? I doubt it. I
considered myself as a decent chart reader, but only trigger trades using
momentum oscillators, within a specific, defined set of rules. That doesn't
mean I find no value in the candles. The candle analysis allows for a lot
of subjective interpretations. When one is trading many markets or many
accounts, subjectivity is the one's biggest enemy. I would love to think
that my intuition and cross-disciplined technical education would lead me to
the absolute best decisions in all trading...but, hey, I know that I'm not
very bright and that I am affected by my emotions. The only thing that
makes sense to me is to establish rules, stick to them and watch you equity
appreciate.
Take care,
Steve Karnish, CTA
Cedar Creek Trading
http://www.cedarcreektrading.com
----- Original Message -----
From: "C.S." <csaxe@xxxxxxxxxxx>
To: <metastock@xxxxxxxxxxxxx>
Sent: Thursday, March 01, 2001 9:21 PM
Subject: Re: A handle on candles
> Steve,
> How about your opinions on candlesticking for commodities and futures?
> Do you feel that they give reliable/valid signals?
> Are they more or less valid on say...financials as opposed to the grains?
> Speak to me, man!
> -Corey Saxe
>
> ----- Original Message -----
> From: "Steve Karnish" <kernish@xxxxxxxxxxxx>
> To: <metastock@xxxxxxxxxxxxx>
> Sent: Thursday, March 01, 2001 4:47 PM
> Subject: A handle on candles
>
>
> > List,
> >
> > Since some of you have probably received the paper "proving" that
> > candlesticks are useless...I thought it might be a good time to jump in
> and
> > stir up the pond.
> >
> > Candles are between 137 and 521 times better than bars. Take it from a
> > technician who has read Edwards and Magee ten times.
> >
> > I monitor, then buy and sell, 50 stocks (key components of the Naz 100,
> Dow
> > 30 and S&P 500). Of the 50, approximately half of them have posted
rather
> > significant "bottoming" candles today. The crude breakdown is:
> >
> > Hammers: MER, MDT, HDI, DYN, MCHP, VTSS, PAYX, RATL
> >
> > Bullish engulfing: ALTR, VSTR, MXIM ERTS, CMVT, CIEN, SEBL
> >
> > Piercing: ATML, KLAC, LLTC, ORCL MOLX, AMAT, PCAR
> >
> > Unless one approaches the markets with a completely mechanical system,
> which
> > I do, all interpretations of charts and indicators involve a lot of
> > subjectivity. Having said that: the above stocks, in general, should
> enjoy
> > a nice bounce because of the pattern of "supply and demand" that is
> > graphically represented by the candles drawn today.
> >
> > The markets will always do whatever they want to do...but, the candles
> drawn
> > today suggest we are in for a good bounce.
> >
> > Steve Karnish, CTA
> > Cedar Creek Trading
> > http://www.cedarcreektrading.com
> >
> > ----- Original Message -----
> > From: "Lionel Issen" <lissen@xxxxxxxxx>
> > To: <metastock@xxxxxxxxxxxxx>
> > Sent: Thursday, March 01, 2001 7:27 AM
> > Subject: candlesticks
> >
> >
> > > A few months back someone posted a comment about candlestick charts. I
> > think
> > > he mentioned that his daughter had done a study and found that the
> > patterns
> > > are random. Would the writer will please e-mail me privately and let
me
> > know
> > > if/where I can get a copy of this paper, I'd appreciate it.
> > >
> > > Lionel Issen
> > > lissen@xxxxxxxxx
> > >
> >
> >
>
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