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Strategies & Market Trends : Candlestick Charting--The unknown indicator -- Ignore unavailable to you. Want to Upgrade?

To: The Perfect Hedge who wrote (1122)	1/24/1998 11:44:00 PM
From: Broken_Clock	Read Replies (1) \| Respond to of 1589

Glen, Don't give up.Remove emotion and mix in some other indicators.Trend lines have helped me alot.I would of made out big time if SLB hadn't missed by a penny!Just ask Free Willie how a little can be a bummer! dave

To: The Perfect Hedge who wrote (1122)	1/25/1998 12:29:00 AM
From: MonsieurGonzo	Respond to of 1589

Glen; RE:" EVI " ...the candlesticks on the OSX.X and EVI have been very clear, Glen - as is the DownTrend Channel on the OSX.X, IMHO. What it boils down to, my friend - is that you have a static, long position in a clear, DownTrend Channel with big "waves" up and down. There is no T/A or F/A that is going to make that feel better. The only way to deal with a trading range, Glen - is to trade. Preferably, with the trend - but regardless - draw a line on the tops and bottoms of the OSX.X DownTrend and that baby is on railraod tracks, man! When the reverse hammer was formed at OSX.X ~89, I posted it. When the "wave" completed - I posted that 105-109 was "profit taking time". No magic involved - it went from the bottom of the channel to the top of the channel; the candlesticks indicated clear reversal signs when it hit the channel walls. Hey man- I feel your pain; really - same thing happened to me in the NAZ bellwethers after August. You've got MAY Calls, right ? You won't lose everything - CL98G is bottoming out; but the OSX.X needs to make a BASE of some sort, somewhere. Keep the faith in your tools; keep the faith in yourself. -Steve

To: The Perfect Hedge who wrote (1122)	1/25/1998 3:48:00 PM
From: Esteban	Read Replies (1) \| Respond to of 1589

Glen, Re: I'm on the verge of trashing the candle charts.I've been faked out so many times with the candles on EVI?I'm dizzy! I think it's important to keep in mind the place of candlestick charting in the grand scheme of technical analysis. They are short term indicators. You have to keep in mind the context of the candlesticks in relation to the overall chart. They're inavaluable for timing trades based on other factors, technical or otherwise. Example: If a stock is trending and you want to buy a pullback, a very good entry point would be when a reversal pattern forms. This can get you an entry right near the bottom of the pullback if the pattern holds. OTH if the stock is in a downtrend and you get a reversal pattern, odds are if there is a reversal it won't be significant until other factors point to a bottom and a major reversal. So when one tries to use candlesticks to predict major reversals, he is playing a low odds game because V reversals usually fail and downtrends are naturally punctuated by several failed up moves. Now if a double bottom forms or the downtrend line is broken or your indicators are diverging from price and you get a candlestick pattern, you have improved the odds considerably and the candlesticks give you the opportunity to get in at a low price. Remember though that the pattern, indicators or your interpretation can be wrong, so it's important to have a stop point in place. Another point: One thing to keep in mind with candlestick charting is that the first requirement for almost every pattern is a trend of at least a few time periods to reverse. You can avoid being whipsawed by confilicting patterns that are very close or alternating by ignoring the ones that have nothing to reverse. Of course you still need a stop point where you figure the original pattern was wrong. Like you, I've been frustrated with candlesticks at times. I look at this technique now as a way to get better entry or exit points and not as a stand alone method. Esteban