Esteban; RE:" Confirmation issues..."
Yes, Esteban (you are a good candlestick reader) I've been playing with the idea of using 300-minute (or some other intra-day time period) as a way of confirming a daily candlestick, a priori.
Gaps (ie., "Windows") are difficult! One can look at charts and say, "they are always filled". But then, hold a stock long enough, and one can prove almost any assertion true (^_^)
Along with Windows there are days like today - most of my TechStocks show RED candles - yet the whole bar is UP for the day, because the pros (futures boyz) opened the market WAY up, and it's been drifting down ever since. Same thing on DownTrends - when they open the market WAY down, and it rallies all day, but the whole candle is lower than the previous session. Tough to trade on those days: because of the Morning or Evening Attacks.
There is this interesting, advanced section in Nison's second book, Beyond Candlesticks, which talks about these new, Japanese chart types - the Three Line Break Chart, the Renko Chart, and the Kagi Chart. To quote page 167:
A Japanese trader described (these charts) as, "a more subtle form of point-and-figure charts where reversals are decided by the market, and not by ordinary rules".
These charts solve the Gap or Window dilemma, Esteban - but I have not come across any chart generator in the West that can generate these kinds of Japanese chart types for us.
-Steve |
