The inside candle high broke as anticipated, and the trend pushed on.
Notice how the inside candle was also resting on a support level within the trend – the more value you can add to the breakout idea, the better.
Context is very important when trading breakout patterns!
If you want to learn more, i highly recommend you purchase my ownebook.the candlestick trading bible.
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A valid bullish Engulfing pattern continues with a third candle (bullish), which breaks the body of the engulfing
candle upwards. A valid bearish Engulfing pattern continues with a third candle (bearish), which breaks the body of the engulfing candle downwards.
If you want to learn more, i highly recommend you get your copy of the candlestick trading bible, it is 168 pages
and costs only 47 dollars, it covers all price action trading strategies you need to start your trading carrer.
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What is a price action trading signal?
As markets move they leave behind what I call a “footprint”, this footprint is price action and it sometimes leaves us clue as to which direction it is heading next. These “clues” are known as price action trading signals / price action patterns / price action setups or price action trading strategies.
What we are looking for is a price action signal to give us some “confirmation” for an entry into the market.
We will see in a little bit how to combine price action with “confluence” in the market to find high-probability entries, but for now let’s just focus on an individual price action entry trigger.
In the chart below we can see examples of one of my favorite price action trading strategies, the pin bar reversal setup.
Note; we included a “failed” pin bar setup just to show that not every setup will work out; just as in real-life trading.If you want to learn how to trade the market the right way, i highly recommend you purchase your copy of the candlestick trading bible.
an other example of how to trade trending markets , as professional traders say, the trend is your friend.try to follow the trend as much you can .here in this example we used only candlestick patterns in combination with support and resistance levels, and moving averages.
as you can see the market responds to the moving average. when price approches the moving average 8 SMA or 21 SMA the market goes down.because banks and financial institutions use the same moving averages.
when you identify a trending markets, please use your moving averages to identify high probability entry point and if the market was moving by making big impulsive moves, use your fibonacci to indetify the end of the corrective moves and the beginning of the impulsive moves.
if you want to learn more, check out the my ebook in my bio. i have explained in details how to trade trending markets using moving averages +fibonacci retracements, supply and demand , an other technical analysis.chekc out the ebook in my bio if you want to become an expert price action trader.
-The pin that was formed provided a signal to traders that the trend line was likely to hold.this gave traders
an opportunity to buy at support to join the rally.if you want to learn how to trade trend line in combination
with price action patterns, chekc out my own ebook the candlestick trading bible in my bio
i wrote a chpater in which i expained in detail how to draw trend lines and how to combine trend lines with price action to get the best trading signals in the market.
Reversal breakouts start off the same way as continuation breakouts in the fact that after a long trend, there tends to be a pause or consolidation.
The only difference is that after this consolidation, forex traders decide that the trend is exhausted and push the price in the opposite or “reverse” direction.
As a result, you have what is called a “reversal breakout”. You catch on quick!
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2 423 days ago
If you don't like money, of if you think that rich people are scammers, you will never make money even if you have the best trading system in the world. it is all about beleifes guys, and it is time to change your beleife about money if you want that money follows you wherever you are .
In the picture below, you can see a good example of how trading the hammer candlestick formation can be very profitable.
This hammer signal was followed by a nice rally in price. It formed on the Aussie (AUDUSD) market on the Daily time frame.
As you can see, price reversed aggressively after this hammer formation.
f you would have gotten into this trade at the 50% entry, you would have been risking about 80 pips.
This swing in price has already moved about 828 pips from the 50% entry of that hammer, and could possibly go further.
So, far this trade would have given you more than a 1:10 risk to reward ratio.
o learn more, i highly recommend you purchase my own ebook.check out the link in my bio or send me a private message if you are interested