THE RESPONSIBLE TRADER – TRADING LESSONS – BLENDING CANDLESTICKS – PART 2
THE RESPONSIBLE TRADER – TRADING LESSONS – BLENDING CANDLESTICKS – PART 2
Actually this is the same procedure when candles for a certain trading period like weekly, monthly, yearly etc. are blended. Let us apply this to the the PSE for the Year-to-date 2017 as indicated in Chart 5.
For year-to-date 2017 we start with the Open of 6846.55 as of December 29, 2016 and the Close of 8558.42 as of December 29, 2017. For the Low we use 6797.66 and High of 8640.04 since these are the highest and lowest for the trading period.
Since the Close of the trading period is higher than the Open we have a white candlestick. The candlestick has very little Upper and Lower Wicks. The result is a Bullish Marubozu which characterizes the Bullish sentiment for the Year 2017.
Let us now look at the Year 2018 using the same Procedure as indicated in Chart 6.
This time we start with the Open of 8562.86 as of December 29, 2017 and the Close of 7466.02 as of December 28, 2018. For the Low we use the 6790.58 registered last October 11, 2018 and the High of 9078.37 registered last January 29, 2018 since these are the highest and lowest for the trading period.
The Close of the trading period is lower than the Open giving us a Black candlestick with Upper and Lower Wicks.
The result is a Black candlestick which is still considered a Marubozu since the real body is bigger than the wicks which characterizes the Bearish sentiment for the Year 2018.
Good luck on all your trades.
NOTE: No change in numbering of Figure is made so that those who have my book, “The Responsible Trader – a Thinking Person’s Guide for Trading the Philippine Stock Market”, can refer to them easily.
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Good luck on all your TRADES today.
DISCLAIMER There is a very high degree of risk involved in TRADING. Past results are not indicative of future returns. Nothing contained in this newsletter constitutes a solicitation, recommendation, PROMOTION or endorsement of any security. In accordance with the Responsible TRADER’s Creed: I will never tell and you take full responsibility for all your TRADING results
NOTES: Please take note of the following changes. Effective August 6, 2015: 1. Caption Market Breadth has been changed to Total Traded Value to simplify the presentation. 2. Market Breadth is expressed in terms of Number of Advances and Declines. Expressing this as a Ratio by using the larger number as Numerator we derive the Market Sentiment whether Bullish or Bearish. 3. Based on Past three-year data of Average Total Traded Values, following classifications will be used to make the presentation more relevant to present times. a. Low – Total Traded Value less than PhP 8 Billion b. Medium – Total Traded Value Php 8 Billion but not more than P15 Billion c. High – Total Traded Value more than Php 15 Billion.
Starting with August 11, 2017 data we are including the Top Ten Gainers and Losers for a more comprehensive coverage of significant stock movements during the day.