#heikin ashi how to read

[rohitch]

Heikin Ashi Candles

While trading the financial markets, you might have probably used several tools and charts to predict the best time to trade.

Because of the high volatility in the financial markets, it has become important to use these advanced trading tools and charts to maximize the profit chances while also lowering the potential loss chances.

In this series, Heikin Ashi Candles is one such advanced charting tool that allows traders to spot market trends and predict future price movements.

As with other traditional candlestick charts, using the Heikin Ashi Candlesticks requires good knowledge and understanding of its fundamentals.

So, if you’re too want to get detailed information about Heikin Ashi candles and how they work? Then, continue reading this guide till the end.

[gagter]

How to read Price Action with Heikin-Ashi and Pivot #Hiekinashi#

How to read Price Action with Heikin-Ashi and Pivot #Hiekinashi#

[fsleleven]

Nifty just flew upwards, and figured out how to give life high, shutting above urgent psychological levels of 14,000. Simultaneously flat bottom green Heikin-Ashi candles on an every day and week by week time period demonstrate the continuation of the positive trend. Read more...

[pro-rsi-blog]

How to do positional trades using Heikin Ashi candles?

The Heikin-Ashi candles are one of the most popular indicators used by technical traders to identify a given trend more easily.  Read on the blog to know more.

[sodajunkie]

Liked on YouTube: "How To Read Price Action With Heikin-Ashi (Stock Trading With Heikin Ashi Candles)" https://www.youtube.com/watch?v=Lwrz6Ckbwqw

[lukkval]

SuperTrend Indicator - 2020 Guide - MultiCharts & TradeStation Download

Are you searching for SuperTrend Indicator? This post if for you!The Supertrend Indicator (ST), developed by Olivier Seban, was born as a tool to optimize the exit from trade, which is a trailing stop.Today is one of the most used tools by traders.In this tutorial, we will explain what it is, how it is used, and how to calculate it. You can also download SuperTrend free versions for TradeStation, MultiCharts, MetaTrader.  What exactly are you looking for?Click to scroll down  Table Of Index What is SuperTrend Indicator? How do you use the ST Indicator? How is SuperTrend calculated? Download SuperTrend indicator for Free

 What is SuperTrend Indicator?

The ST Indicator ST belongs to the category of follower trend indicators. These types of indicators signal the direction of the trend and highlight the continuation or changes of direction.This indicator works well in a trending market.And very similar in his conception to Wilder’s Parabolic SAR. However, the Supertrend has the merit of positioning itself horizontally, in a sort of stand by, in moments of price laterality, avoiding getting us out of position before time.We must always remember that all trend-follower indicators have a common flaw: they warn of the change of trend AFTER the change has taken place, not PRIMA.They are all indicators that update with an inevitable delay; they are not anticipators of the trend.Let’s see the two indicators in comparison: the SuperTrend is represented with the solid line, while the Parabolic SAR with the classic green dots (up) and red dots (down)

It is immediately noticeable that the continuous color change of the Parabolic SAR gives rise to many more false signals than the SuperTrendHowever, the ST has two enormous merits:1) It is straightforward to use because the identification of the trend takes into account the average volatility of the asset.2) It can be used with any timeframe and all financial instruments (shares, indexes, forex).Others do not do so and, therefore, often force them to leave the market too early.On the other hand, the SuperTrend filters many false signals, and this allows us to keep the position open for longer and increase the average profit.

A trend follower strategy to be successful must remain on the market as long as possible.The longer you stay on the market, the more trends you can take advantage of.At the same time, it also needs to come out quickly if the trade is going the wrong way.

How do you use the ST Indicator?

From a graphical point of view, the Super Trend appears as a red or green line that accompanies price trends.The red line identifies periods characterized by a negative trend, while the green line indicates market periods with a positive trend.When the line is below the graph, the trend will be upward, and it will, therefore, be preferable to open long positions.When the indicator line is above the graph, the trend will be downward, and it will, therefore, be preferable to open short positions;There are 3 different ways you can use this indicator:Filter OperationsThe ST show us the current trend, remember that we do not want to go against the primary uptrend or downtrend.So if the underlying trend is upward, we will only do long trades, if downward only short trades.In this way, we filter several false “counter-trend” buy signal or sell signal.The reversal of a trend occurs when prices cross the indicator line positioned at a given level from one side to the other.This level is defined as a roof or floor, depending on whether it is above or below the price scale.

We need it as a trailing stop.The ST can be used to manage the exit from another trading strategy.This indicator will keep us in the extended position until the indicator remains green or short until the indicator remains red.We'll get out as soon as the color changes.SuperTrend Trading StrategyWe could use a Supertrend Trading Strategy to find buy or sell signal.We open a long position at the change of color from red to green (buy signal is generated).Vice-Versa we can opening a short trade when green become red (sell signal is generated).Positions will close the next time the indicator changes color.Theoretically, we can always stay in the market – stop & reverse strategy – moving from long to short all the time.

With this technique, there will be no shortage of false signals, especially in phases of prolonged laterality.It will, therefore, be of fundamental importance to close the position in stop-loss if the market does not go in the desired direction.We prefer to suggest that you do not use it alone but integrate it into your trading systems with the use of other tools.Even if the ST is a very valid indicator, it is better to use it in combination with at least one other.We can use it together with the CCI, Momentum, ADX, RSI. Two SuperTrend Indicators - The Double StrategyThere is also the possibility to take advantage of ST not in combination with another technical indicator, but by combining two ST indicators.We can then apply the same indicator to the graph but with two different settings, one fast and one slow.In this case, when the fast curve crosses from bottom to top the slow curve, we have a long signal.When the fast curve returns below the slow curve, it is time to close the operation. We practically expect both curves to have the same color.

Which Timeframe to use for SuperTrend IndicatorAt first, we said that the SuperTrend has the advantage of being able to be used in every timeframe.In general, however, on intraday trading timeframes it loses its effectiveness, there is no single rule, it is advisable to make a few attempts on the financial instrument we intend to trade.Although it should always be remembered that the real trend exists only on long time frames, so from the daily up.

SuperTrend Indicator MultiTimeFrameAlways to limit false signals, we have built a SuperTrend Multi Time Frame indicator.You can find the article and indicator to download for free at this link.

How is ST Indicator calculated?

The ST is calculated based on a coefficient that is applied to the average volatility of the period considered.The Super Trend indicator is calculated using the Average True Range (ATR).The Average True Range is an indicator that calculates the average range of the last X seats and measures volatility.Once volatility is identified, the Super Trend is calculated by applying to the latter a volatility multiplier and a coefficient relative to the observation period over which volatility is calculated.It must always be borne in mind that the higher the weight of volatility, the wider the range of tolerance before a reversal of trend occurs.The SuperTrend Indicator Formula:Upper=(high+low)2+ (Multiplier∗ATR)Lower=(high+low)2− (Multiplier∗ATR)

Download Super Trend Indicator for Free

This is our custom Super Trend indicator coded in EasyLanguage for TradeStation and MultiCharts. You can download it for free.Download SuperTrend MultiCharts Indicator for FreeDownload SuperTrend TradeStation Indicator for Free

Conclusions

Is the ST Indicator a great indicator?The ST is, indeed, a great indicator.However, we always remember that when long sides are formed, the Supertrend generates many false signals, but it is still the biggest flaw of all the trending indicator.

Q&A

Can I use the ST for intraday trading? It is certainly possible to use it but we do not like it as a trading system because in the market the ongoing trend exists are on high timeframes. A correct ST trading strategy should be based on daily timeframes or higher.Is it the best trending indicator? For us it is the best trending indicator. The Super Trend Indicator is the one that provides fewer false signals, compared to parabolic sar for example Editors' Recommendations:SuperTrend Multi Time Frame IndicatorHow to AutoTrade DivergencesSuperTrend for TradeStation and MultiChartsHOW TO USE THE MOVING AVERAGES TO IDENTIFY THE TRENDCMO Indicator | Chande Momentum Oscillator | TutorialEasyLanguage TutorialFree EasyLanguage IndicatorEasyLanguage & PowerLanguage Tutorial - Time and DateIchimoku Indicator | Ichimoku Kinko Hyo | TutorialHow to read a Price Chart - Bar Chart - CandleStick - Kagi - Heikin AshiMoving Average: All about Moving Averages || 2020 TutorialThe Vortex Indicator || TutorialHow to Use the TradeStation Backtest to Analyze an InstrumentGraphic Technical Analysis - How to read a stock market chartsTutorial - Using EasyLanguage to Export Data From TradeStation to ExcelWhat is the Dow Theory in technical analysisYou can learn more about this indicator, reading these resources:Wikipedia Please insert your name and your email address. We will send you the Indicator for free !!!​ Your Information is safe with us. We respect your privacy! We will never share your data with anyone else who might. Please check your Junk E-mail folder Free Indicator for Multicharts​ Free Indicator for TradeStation​ Do you want to learn EasyLanguage & PowerLanguage for TradeStation and MultiCharts? Start here:EasyLanguage & PowerLanguage Master Tutorial A lot of free Indicators in EasyLanguage & PowerLanguage for TradeStation and MultiCharts: TradeStation and MultiCharts Indicators

Are you looking for a NinjaTrader SuperTrend? You can find it in the NinjaTrader Forum. Read the full article

[phungthaihy]

How To Read Price Action With Heikin-Ashi (Stock Trading With Heikin Ashi Candles) http://ehelpdesk.tk/wp-content/uploads/2020/02/logo-header.png [ad_1] In this video you will discover:... #accounting #algorithmictrading #cfa #daytrading #excel #finance #financefundamentals #financialanalysis #financialmanagement #financialmodeling #financialtrading #forex #forexcfdtrading #heikenashi #heikenashicandlesmt4 #heikenashicandlesticks #heikenashiindicator #heikenashiscalpingstrategy #heikenashistrategy #heikenashitrading #heikenashitradingstrategy #heikinashi #heikinashicandlesticks #heikinashicandlesticksstrategy #heikinashichart #heikinashidaytrading #heikinashiforbeginners #heikinashiforex #heikinashipatterns #heikinashitradingstrategy #heikinashivscandlesticks #investing #investmentbanking #optionstrading #personalfinance #stocktrading #technicalanalysis #thesecretmindset

[brettzjacksonblog]

Bitcoin Price Monthly Close Above $8,000 Forms Bullish ‘Hammer’ Reversal

The current monthly candle on Bitcoin price charts is unlike any other that can be found since the bear market first began, with a massive bottom wick nearly double the length of the candle body itself. Should Bitcoin price close the monthly candle at around or above $8,000, it would form a powerfully bullish reversal candlestick called a “hammer.” A close like this could signal a reversal is near, and that the low is likely in. Bitcoin Price Could Close Monthly As Powerful Reversal Candle Bitcoin price has had an unusual start to the year. After rallying over 50% and going on to retest highs above $10,000, weeks later, the first-ever cryptocurrency plummeted to under $4,000 after a historic, single-day collapse. The resulting price action has left one of the largest monthly red candles on Bitcoin price charts over the last five years. Red candles this large and powerful haven’t been seen since the cryptocurrency last bottomed during the 2014-2015 bear market. Related Reading | Economist: Government Overspending Amidst Crisis is Bullish for Bitcoin After the record-breaking collapse to below $4,000, Bitcoin quickly recovered and grew by nearly double, leaving a massive wick behind on the monthly candle. However, resistance at $6,800 and higher are keeping the leading cryptocurrency by market cap from reaching higher levels. If Bitcoin price can regain some momentum, and close the monthly candle this coming Tuesday back around or above $8,000, then the monthly candle will close as a bullish “hammer” reversal candle. If the #Bitcoin monthly candle closes around $8,000 reducing the body candle… bullish hammer will come into play. Be ready. pic.twitter.com/7zJ2EUX7xp — Crypto Rand (@crypto_rand) March 25, 2020 Education: Learn All About the Bullish Hammer Japanese Candlestick Bitcoin price charts, like the price charts of any assets, are often displayed with green and red candles with varying sized bodies and wicks. These are called Japanese candlesticks. Other types of price charts include line charts, Kagi, Heikin Ashi, Renko, and Point & Figure. All offer analysts a different perspective on the price action, but Japanese candlesticks are among the most common for their easy to read signals and price patterns. How these Japanese candlesticks close or how they appear in sequence can oftentimes help analysts and traders predict upcoming price action. Certain candlesticks and patterns can even signal when a reversal is near. Among the type of candlesticks that provide such a signal, is the bullish hammer. The candlestick is represented by a long wick at the bottom and a small or non-existent wick at the top of a small candle body. The candle resembles a hammer with a handle and can close green or red. Related Reading | This 90-Year-Old Japanese Indicator Says Bitcoin Uptrend Is Forming The candlestick depicts sellers coming on strong during the candle open, but the selloff is absorbed by buyers rapidly scooping up the asset at such low prices. This type of price action typically signals a reversal is due, as the price has fallen to attractive enough prices to resume interest once again. However, the candlestick is only valid with confirmation, or with upside following the monthly candle close forming such a pattern. If the pattern does confirm, the bottom is likely in, and Bitcoin price will resume into an uptrend from here. Featured image from Shutterstock from CryptoCracken SMFeed https://ift.tt/2UCoYIc via IFTTT

[michaelbennettcrypto]

Bitcoin Price Monthly Close Above $8,000 Forms Bullish ‘Hammer’ Reversal

The current monthly candle on Bitcoin price charts is unlike any other that can be found since the bear market first began, with a massive bottom wick nearly double the length of the candle body itself. Should Bitcoin price close the monthly candle at around or above $8,000, it would form a powerfully bullish reversal candlestick called a “hammer.” A close like this could signal a reversal is near, and that the low is likely in. Bitcoin Price Could Close Monthly As Powerful Reversal Candle Bitcoin price has had an unusual start to the year. After rallying over 50% and going on to retest highs above $10,000, weeks later, the first-ever cryptocurrency plummeted to under $4,000 after a historic, single-day collapse. The resulting price action has left one of the largest monthly red candles on Bitcoin price charts over the last five years. Red candles this large and powerful haven’t been seen since the cryptocurrency last bottomed during the 2014-2015 bear market. Related Reading | Economist: Government Overspending Amidst Crisis is Bullish for Bitcoin After the record-breaking collapse to below $4,000, Bitcoin quickly recovered and grew by nearly double, leaving a massive wick behind on the monthly candle. However, resistance at $6,800 and higher are keeping the leading cryptocurrency by market cap from reaching higher levels. If Bitcoin price can regain some momentum, and close the monthly candle this coming Tuesday back around or above $8,000, then the monthly candle will close as a bullish “hammer” reversal candle. If the #Bitcoin monthly candle closes around $8,000 reducing the body candle… bullish hammer will come into play. Be ready. pic.twitter.com/7zJ2EUX7xp — Crypto Rand (@crypto_rand) March 25, 2020 Education: Learn All About the Bullish Hammer Japanese Candlestick Bitcoin price charts, like the price charts of any assets, are often displayed with green and red candles with varying sized bodies and wicks. These are called Japanese candlesticks. Other types of price charts include line charts, Kagi, Heikin Ashi, Renko, and Point & Figure. All offer analysts a different perspective on the price action, but Japanese candlesticks are among the most common for their easy to read signals and price patterns. How these Japanese candlesticks close or how they appear in sequence can oftentimes help analysts and traders predict upcoming price action. Certain candlesticks and patterns can even signal when a reversal is near. Among the type of candlesticks that provide such a signal, is the bullish hammer. The candlestick is represented by a long wick at the bottom and a small or non-existent wick at the top of a small candle body. The candle resembles a hammer with a handle and can close green or red. Related Reading | This 90-Year-Old Japanese Indicator Says Bitcoin Uptrend Is Forming The candlestick depicts sellers coming on strong during the candle open, but the selloff is absorbed by buyers rapidly scooping up the asset at such low prices. This type of price action typically signals a reversal is due, as the price has fallen to attractive enough prices to resume interest once again. However, the candlestick is only valid with confirmation, or with upside following the monthly candle close forming such a pattern. If the pattern does confirm, the bottom is likely in, and Bitcoin price will resume into an uptrend from here. Featured image from Shutterstock from Cryptocracken WP https://ift.tt/2UCoYIc via IFTTT

[joshuajacksonlyblog]

Bitcoin Price Monthly Close Above $8,000 Forms Bullish ‘Hammer’ Reversal

The current monthly candle on Bitcoin price charts is unlike any other that can be found since the bear market first began, with a massive bottom wick nearly double the length of the candle body itself. Should Bitcoin price close the monthly candle at around or above $8,000, it would form a powerfully bullish reversal candlestick called a “hammer.” A close like this could signal a reversal is near, and that the low is likely in. Bitcoin Price Could Close Monthly As Powerful Reversal Candle Bitcoin price has had an unusual start to the year. After rallying over 50% and going on to retest highs above $10,000, weeks later, the first-ever cryptocurrency plummeted to under $4,000 after a historic, single-day collapse. The resulting price action has left one of the largest monthly red candles on Bitcoin price charts over the last five years. Red candles this large and powerful haven’t been seen since the cryptocurrency last bottomed during the 2014-2015 bear market. Related Reading | Economist: Government Overspending Amidst Crisis is Bullish for Bitcoin After the record-breaking collapse to below $4,000, Bitcoin quickly recovered and grew by nearly double, leaving a massive wick behind on the monthly candle. However, resistance at $6,800 and higher are keeping the leading cryptocurrency by market cap from reaching higher levels. If Bitcoin price can regain some momentum, and close the monthly candle this coming Tuesday back around or above $8,000, then the monthly candle will close as a bullish “hammer” reversal candle. If the #Bitcoin monthly candle closes around $8,000 reducing the body candle… bullish hammer will come into play. Be ready. pic.twitter.com/7zJ2EUX7xp — Crypto Rand (@crypto_rand) March 25, 2020 Education: Learn All About the Bullish Hammer Japanese Candlestick Bitcoin price charts, like the price charts of any assets, are often displayed with green and red candles with varying sized bodies and wicks. These are called Japanese candlesticks. Other types of price charts include line charts, Kagi, Heikin Ashi, Renko, and Point & Figure. All offer analysts a different perspective on the price action, but Japanese candlesticks are among the most common for their easy to read signals and price patterns. How these Japanese candlesticks close or how they appear in sequence can oftentimes help analysts and traders predict upcoming price action. Certain candlesticks and patterns can even signal when a reversal is near. Among the type of candlesticks that provide such a signal, is the bullish hammer. The candlestick is represented by a long wick at the bottom and a small or non-existent wick at the top of a small candle body. The candle resembles a hammer with a handle and can close green or red. Related Reading | This 90-Year-Old Japanese Indicator Says Bitcoin Uptrend Is Forming The candlestick depicts sellers coming on strong during the candle open, but the selloff is absorbed by buyers rapidly scooping up the asset at such low prices. This type of price action typically signals a reversal is due, as the price has fallen to attractive enough prices to resume interest once again. However, the candlestick is only valid with confirmation, or with upside following the monthly candle close forming such a pattern. If the pattern does confirm, the bottom is likely in, and Bitcoin price will resume into an uptrend from here. Featured image from Shutterstock from Cryptocracken Tumblr https://ift.tt/2UCoYIc via IFTTT

[abigailswager]

As Bitcoin Price Consolidates, Litecoin Looks Ripe for Massive Gains

New Post has been published on https://dailybitcoinupdates.com/as-bitcoin-price-consolidates-litecoin-looks-ripe-for-massive-gains/

As Bitcoin Price Consolidates, Litecoin Looks Ripe for Massive Gains

Bitcoin price (BTC) failed to ignite much interest as October closed. There are approximately 194 days left until the next Bitcoin halving, which probably feels like an eternity away for those involved with the crypto space.

This week there was also a surplus of negative news events like the Bitmex email leak and the Coinbase flash crash that caused mass liquidations on Deribit. So can we really expect Bitcoin price to do anything spectacular in the short term?

Daily crypto market performance. Source: Coin360.com

BTC USD daily chart. Source: TradingView

Bitcoin price has been locked in a tight range around $9,100 – $9,400 for the last 5 days. However, since the massive move 2 weeks ago, the Bollinger Bands (BB) indicator has opened up revealing quite a broad range of support and resistance.

The moving average shows $8,600 being the level of support that Bitcoin needs to hold before falling back in to the $7,000 range. However, it is a positive sign that Bitcoin is currently holding in the upper percentile of the Bollinger Bands as the resistance that Bitcoin needs to break to begin a new upward trend is at $9,900.

But what does the week ahead hold? Well, let’s first take a look at the first major bullish signal for Bitcoin that came on Nov. 1 when a new green monthly candle was printed.

BTC USD monthly chart. Source: TradingView

Let’s not underestimate the significance of this particular signal. The last time that the Heikin Ashi candles transitioned from red to green on the Bitcoin monthly chart was on April 1st, 2019.

Within just 12 weeks of this last occurring, Bitcoin’s price exploded from a low of $3,979 to $13,868 which represented a massive 350% growth in BTC/USD value.

Whilst it’s still early days, as each week progresses Bitcoin is slowly showing more bullish signs, and if history were to repeat itself we could be instore for 29% weekly growth as we head into the new year. But what other signs are there?

Is the weekly MACD turning bullish?

BTC USD weekly MACD. Source: TradingView

The weekly chart for Bitcoin has some golden nuggets starting to appear but they are not quite there yet. Using the Moving Average Divergence Convergence (MACD) we can see that the MACD line is beginning to gear up for a bullish cross, and for the past 2 weeks, the red candles on the histogram have been getting weaker.

This is a telltale sign that Bitcoin is due to enter its next bullish phase in the coming weeks. How long this will take depends on a multitude of factors, but one such place to look is on the Relative Strength Index (RSI) indicator to see if Bitcoin is oversold yet.

The weekly RSI is not showing any signs of life

BTC USD weekly RSI. Source: TradingView

Currently, the RSI on the weekly timeframe is planted in a no-trade zone. Whilst this does not necessarily mean that Bitcoin price will not increase this week, this particular indicator isn’t giving off a strong buy or sell signal.

The RSI is currently reading 54.99 after bouncing up from 45 over the last few weeks. It could be that we have already witnessed a reversal and Bitcoin price could begin to rise, but history tells us that there is probably some more downward movement ahead of us before we start to see sustainable weekly gains.

Bitcoin price targets

BTC USD weekly chart. Source: TradingView

The massive spike that occurred two weeks ago did cause Bitcoin’s price to break the moving average (MA) on the Bollinger Bands (BB) Indicator. One can normally expect the price to then form new support above the MA.

This hasn’t yet happened, and at the time of writing the moving average is around $9,945 whilst Bitcoin price is currently $9,148. Given the visible momentum from the candles on the weekly chart, it is not unreasonable to expect Bitcoin price to close over $10,000 before the end of the coming week if the bulls have their say.

If Bitcoin price can achieve this growth, then this puts $12,000 as the next level of resistance. On the downside, however, the support is still around $7,914 so the coming week could hold lots of surprises for both the bulls and bears amongst us.

Is Litecoin poised for 42% gains?

LTC USD weekly chart. Source: TradingView

There are a few reasons to focus on Litecoin (LTC). Using the same analysis on Bitcoin, the weekly positioning looks like a stronger buy on Litecoin than is does on Bitcoin.

Litecoin price seemed to have found support two weeks ago around $47 and at the time of writing the LTC/USD pair is at $57. Using the moving average on the Bollinger Bands indicator to gauge the next level of resistance shows that Litecoin looks ripe for a move up to $82 before being rejected, which would represent growth of 42%

Comparing MACDs

LTC USD weekly MACD. Source: TradingView

From a glance of Litcoin’s weekly MACD, we can see that whilst the MACD and signal lines look almost identical to that of Bitcoin, the histogram is showing is that a bullish reversal is likely to be more imminent than Bitcoin’s weekly MACD. Litecoin has printed four consecutively weaker candles whereas there are only two on Bitcoin.

As the weekly candle draws to a close on Litecoin, it is likely to show a stronger buy signal to that of Bitcoin, and the RSI provides further confirmation of this.

Litecoin’s RSI looks oversold

LTC USD weekly RSI. Source: TradingView

Compared to Bitcoin, Litecoin’s RSI is at 38.96 after a bounce from 34. Typically traders that use the RSI to identify heavily oversold assets would be looking for a reading below 30, but it’s a far better signal than Bitcoin’s current reading in the high 50’s.

As such, from a purchasing point of view, Litecoin looks to have greater upside potential and stronger technicals than Bitcoin for the week ahead.

Bearish scenario

As Bitcoin continues to consolidate, the first level of support can be found at $8,600. The bears might be cheering this forthcoming week so I’d expect this would be a short-lived victory.

Should $8,600 fail to hold, the next levels are $7,900 and then $7,200. The doom and gloom scenarios calling for a revisit to $6,000 are now less likely to playout, however never say never, Bitcoin forever surprises investors and traders alike.

Bullish scenario

Bitcoin is currently about $600 away from both support and resistance, but a break upwards at this stage could see the price begin to form a new level of support around the $9,900 region.

The views and opinions expressed here are solely those of the @officiallykeith and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Litecoin’s technical setup suggests that the altcoin may be gearing up for a 42% gain as Bitcoin price stumbles

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[petero1298]

Your Ultimate Guide to Trading with Heikin Ashi Candles                                                   

By Vladimir Ribakov -  August 28, 2016

Introduction To Heikin Ashi Candles

Heikin Ashi Candlesticks are an offshoot from Japanese candlesticks. Heikin-Ashi Candlesticks use the open-close data from the prior period and the open-high-low-close data from the current period to create a combo candlestick.

The resulting candlestick filters out some noise in an effort to better capture the trend. In Japanese, Heikin means “average” and “ashi” means “pace” (EUDict.com). Taken together, Heikin-Ashi represents the average-pace of prices.

Heikin-Ashi Candlesticks are not used like normal candlesticks. Dozens of bullish or bearish reversal patterns consisting of 1-3 candlesticks are not to be found.

Instead, these candlesticks can be used to identify trending periods, potential reversal points and classic technical analysis patterns. A fantastic in-depth explanation on the subject provided by Dale Woods (Original article could be found here) explains all you need to know.

Have you ever been riding a trend, then been spooked out of a position because it seemed like price was going to turn against you – only to see the trend continue another 300 pips?

Maybe you’re having trouble spotting the main trend, or market reversals?

Heikin Ashi candlesticks may be of interest to you, they can help with: trend analysis, pinpointing key reversals, and enhancing your exit strategy.

Heikin Ashi candlesticks are another clever invention from the minds of great Japanese traders. I’ve been a fan of these modified candlesticks for most of my trading career, but I feel they are rarely spoken about or used to their full potential.

They are a lesser known customized form of price action – but building in popularity, providing traders a new insight into technical analysis.

These bad boys can be used with any market on any time frame.

In this guide, I am going to walk you through how Heikin Ashi charts work, and how these customized candlesticks can give you a different unique perspective and perhaps change the way perform your chart analysis…

THE ANATOMY OF A HEIKIN ASHI CANDLE

Translated from Japanese, Heikin Ashi means ‘average bar’ and you will see why.

They are the result of applying some average math directly to the candlestick structure.

One main goal of Heikin Ashi candlesticks is to eliminate noise on the chart. This is achieved through the way the Heikin Ashi charts are built through the equation.

The ‘formula’ for their construction is designed to creates a ‘smoothing’ effect – filtering out the irrelevant moves, while maintaining the display of the dominant price action.

Heikin Ashi candlesticks requires data from the previous HA candle, meaning they essentially build off one another. It is this chaining effect that gives a really unique view into the market.

The classic candlestick we’re all used to has a high, low, open, and close price. These figures are taken directly from the raw price action.

Heikin Ashi candles have the same 4 data points, but they each have some unique math behind them – which is important to understand if you’re going to use them.

High Price = highest price out of the current candle’s high, open, or close price

Low Price = lowest price out of the current candles’s low, open, or close price

Close Price = (open + high + low + close) / 4

Open price = previous candle (open + close) / 2

To summarize, the high and low prices are nothing special. The Heikin Ashi candle will just show the highest and lowest data point achieved while it was active.

What you will find in strong bullish conditions is that the open and low price are the same, and during bearish momentum, the open and high price are equal.

When the open price syncs up with the high or low, you know you you’ve got some good market momentum. 

You can see, when you compare the two charts together, how the Heikin Ashi chart helps filter out those counter trend movements and keep the dominant trend in display.

It’s the way open and close prices are calculated that gives this filtering effect.

The open price is derived from the previous candle’s open and close prices.

If you look at the formula carefully, it makes each new Heikin Ashi candle open in the middle of the previous candle’s body’s range.

One of the main reasons these charts looks so neat and orderly is the way the open price is being printed. 

The close price is the other interesting aspect of the Heikin Ashi candlestick anatomy.

It takes all 4 data points of the candle, adds them together – then divides that figure by four to spit out an average price of all the candle data points.

The close price is basically the average point of all the prices in the candle.

It’s important to understand that the close price also means the current candle price while the candle is active. When the candle closes, the last close price will be cemented in as the final close price.

Every time the market receives a new price tick, the Heikin Ashi formula is executed again, all the prices are recalculated and the candle anatomy is updated appropriately.

SUMMARY

Heikin Ashi are a unique kind of ‘average’ candlestick which build off one another to created a smoothing effect. This gives a new perspective of the price action, opening up the door for some unique technical analysis.

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Chart School

1. The Heikin-Ashi Close is simply an average of the open, high, low and close for the current period. <b>HA-Close = (Open(0) + High(0) + Low(0) + Close(0)) / 4</b> 2. The Heikin-Ashi Open is the average of the prior Heikin-Ashi candlestick open plus the close of the prior Heikin-Ashi candlestick. <b>HA-Open = (HA-Open(-1) + HA-Close(-1)) / 2</b> 3. The Heikin-Ashi High is the maximum of three data points: the current period's high, the current Heikin-Ashi candlestick open or the current Heikin-Ashi candlestick close. <b>HA-High = Maximum of the High(0), HA-Open(0) or HA-Close(0) </b> 4. The Heikin-Ashi low is the minimum of three data points: the current period's low, the current Heikin-Ashi candlestick open or the current Heikin-Ashi candlestick close. <b>HA-Low = Minimum of the Low(0), HA-Open(0) or HA-Close(0) </b>

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BENEFITS OF HEIKIN ASHI CHARTS

There are many benefits a Heikin Ashi chart can provide to your technical analysis.

Obviously, the main purpose of these charts is to clean up the noise and display dominant trend strength.

Notice how the Heikin Ashi charts prints out a lot smoother price action, helping draw out the main market movement.

Check out what happens during strong trending markets.

Although the price chart is fairly easy to read, you can’t deny that the Heikin Ashi chart does a very good job at straightening out the market structure.

We can easily see where the core trend movement is and where the counter trend corrections are occurring.

Even the double bottom pattern looks a lot cleaner.

If you’re having trouble determining the trend, these charts could be a good aid for you.

They are also great for keeping you in a trend trade longer. It is common to believe price is moving against you, and find out you got spooked out by a counter trend retracement soon after.

I know there are a lot of traders who ‘cut their profits short’ in these scenarios.

Check out how Heikin Ashi charts may help with the psychological problem of ‘price moving against you’…

This is one of the key advantages of HA candlesticks, the ability to ‘cut the crap’ when the market is trending.

Look how well of a job they did in the AUDCAD example above. You basically only see blue candles until the trend dies out, and then a larger red candle is printed.

Charts like these maybe just the thing you need to stop those early exits.

Reversals can be much easier to spot, especially with the classic ‘color change’ in the Heikin Ashi candles…

You can see that when the candles change dramatically from bullish to bearish, there can be a large follow through reversal.

Obviously it wouldn’t be profitable to trade every single color change because when the market falls into consolidation, you will get eaten alive.

These reversals tend to be more potent after a large bullish or bearish move has already occurred before leading into the color change signal.

SUMMARY

The filtering effect of Heikin Ashi candlesticks allows for a very clear view of the market structure and dominant trend movement. This allows traders to spot trends easily, ride them out longer to their full potential, and also spot reversal opportunities when they die out.

HOW TO READ HEIKIN ASHI CANDLESTICKS

So far, we looked at how the HA candlesticks can help provides a better visual experience for traders, and collectively help with market analysis.

Now lets dive into the individual Heikin Ashi candlesticks and learn how to read the individually.

If the body of the candle is bullish – it reflects a bullish environment.

If the body of the candle is bearish – it reflects a bearish environment.

If the body of the candle is thin, and there is wicks protruding out both ends of the body, the market is indecisive, has stalled, or is consolidating.

If a strong trend is underway, the candlesticks become a gauge to the current trend strength.

Remember the close price is the average of all the data points in the candle, so if the close price is very high, then you have strong bullish pressure in the market.

Upper wicks will start to appear when the bullish momentum slows down, and more bearish pressure starts to enter the market.

Same obviously applies to bearish conditions. The candles will close lower into the candle range under strong bearish trends.

Remember:

Big candle range + big candle body = Strong momentum

Small candle ranges + small candle body = Weak momentum

Because these candlesticks change drastically when the market conditions shift, it’s very easy to see when the markets fall into consolidation, when you don’t really want to be in the market.

It’s fairly easy to spot dangerous market conditions with Heikin Ashi price action.

Try to stay out of the market when you start seeing doji like candles, especially large ones.

When these charts go into nasty sideways action, there will be a lot of candles with wicks coming out of both ends of the body – a warning sign to be on the side lines.

I always say, if you can’t make sense of the chart, then simply don’t trade it!

The chart above shows how these charts can do a great job and displaying a the change in market conditions.

One Doji formation – a double wicked candle – was a warning sign of dangerous consolidation to come.

Like normal candlestick chart, Doji patterns are a reflection of indecision, consolidation or unstable volatility. The effects of Doji candles on HA charts are more emphasized.

SUMMARY

The HA candles change dramatically in appearance when price conditions change – making them an aesthetically easier chart to understand. Big body candles generally mean good trending strength, small double wicked candles generally mean bad trading conditions.

   WARNING: HEIKIN ASHI CANDLES CAN BE VISUALLY MISDIRECTING

When you look at these charts, you will imminently think it is a gold mine. But we all know there is no free lunch ?

If you remember the calculations we went through before on how a Heikin Ashi is formed… you might have picked up that Heikin Ashi candlesticks don’t always reflect the current prices in the market.

In a normal candlestick, the close price is the current price in the market.

On a Heikin Ashi candlestick, the close price is an average of all the candle data. This means the close price of a Heikin Ashi candle is going to be different to the current market price!

As a trend develops, the Heikin Ashi candles really start to build momentum off one another as price is driven higher or lower – the spread between the actual market price and the HA price will expand dramatically.

I actually like this mathematical outcome because it punishes traders for buying too high and selling too low – which is a common problem for novice trend traders.

When the market settles down, the distance between real price and HA price will contract significantly.

    Notice how the prices are fairly aligned in the chart above. The trending conditions have stopped and the market is drifting sideways, allowing the market price to catch up with HA price.

Now when a trading opportunity occurs, you will be able to get in closer to the market bid.

Just remember, when you’re taking a Heikin Ashi trade, to check where the real market price is. This is important because you need the real market price to execute correct risk management calculations.

SUMMARY

Heikin Ashi charts can be misleading when compared to the actual price of the market due to the average math in the construction of these candles. The spread between HA price and real market price widens after strong momentum and contracts when the market stalls. This discourages buying the tops, and selling the bottoms.

HOW TO TRADE HEIKIN ASHI – SOME TRADE IDEAS

Allow me to give you some ‘food for thought’ to get started with trading Heikin Ashi charts.

Traditional forms of technical analysis, and your classic chart patterns are still going to be relevant.

We can see above the classic swing level still being relevant. Look how well HA displays the ebb and flow off support and resistance levels. 

Classic patterns like the double top, and the head & shoulders patterns can be easily spotted and traded as per your plan.

Consolidation breakouts are also easy to spot and work out well.

Whenever a Heikin Ashi candle closes outside of these consolidation structures, it is a good indicator that a breakout is underway.

It may even be beneficial to watch lower swing trade time frames to catch an intra-day HA breakout for an earlier entry – because you’ve always got to keep in mind the spread between the HA price and the real market price.

Another example of effective structure breakouts are simple trend line breaks.

Due to the market structure being easy to see with Heikin Ashi charts, trend lines are easier to mark. Watch for the break of obvious trend lines…

These charts are also an excellent opportunity for trailing stops… especially during strong trends.

When the open price aligns with the high or low of the candle in a trend, this may the opportunity for you to trail your stop if you’re into that.

Trailing a stop behind the previous candle’s low or high may be a little aggressive – consider trailing the stop behind the high or low of two candles ago.

The stacking trend candles may also be used with scale in strategy, adding to your position as the trend develops.

Careful with this though – because the HA / Market price spread is going to increase as the trend develops, making it more difficult to scale in as the trend extends out.

SUMMARY

Heikin Ashi charts really open up the door for some unique strategies, while still maintaining use of classic technical analysis. Market structure and consolidation periods are simpler to spot. Therefore, breakout trades are more obvious. The structure of HA candles also open up the door for some clever money management strategies.

How to Get Heikin Ashi on MT4 

Metatrader does not naturally support Heikin Ashi candles, to get them – you need custom plugins that will generate them for you.

Naturally there are free MT4 HA generators out there, but they can be annoying to use – and can be filled with annoying bugs.

Here is a free one if you want to test them out.

If you’re more serious about Heikin Ashi charts, you might be interested in my custom chart generator tool.

This cutting-edge panel allows you to customize your own charts for a unique view on price action – that includes custom tailored HA candles.

You can check out the info on the current chart generator here.

The second version of this panel will support Heikin Ashi, and is almost ready for release, here is a sneak peak…

If you’re on my email list, I will shoot out an email to everyone when this is ready. It is proving to be a very powerful and convenient tool.

I hope this guide was helpful. Please leave me a comment below and let me know if it was, or just leave me your feedback or experiences with Heikin Ashi charts. I always look forward to reading your comments!

Stay safe and profitable out there! Best of luck on the charts this week 🙂

[pro-rsi-blog]

How to do positional trades using Heikin Ashi candles?

The Heikin-Ashi candles are one of the most popular indicators used by technical traders to identify a given trend more easily. Read on the blog to know more.

[bobjlower]

Heiken Ashi Candlestick Trading Explained

There are times when seeing a lot of detail can lead to a more enhanced and nuanced interpretation. But there are other times when seeing too much detail is tantamount to seeing nothing at all.

Take a look at the (much feared and avoided) lumber futures chart below.

 This chart looks fairly easy to interpret, as there are only two major movements taking place–a sharp uptrend and a longer downtrend with a 0.5 Fib retracement half way through.

But because line charts erase opening, high, and low points in addition to any trading gaps that might have occured, this chart may be filtering out some crucial information that might be critical to a trader’s decision-making process.

If you had to trade off this chart, it would be very difficult to get deeper insight into market sentiment and nearly impossible to set detailed entry or exit points based on support, resistance, and retracements.

So, let’s pull up a traditional candlestick chart in order to see price action in much greater detail.

 Now you can see the open, high, low, and close of each trading session. You can clearly see which days were bullish and which were bearish.

In retrospect, it’s easy to see the general trend. But imagine having to make trend-based decisions after each session (an up day followed by a down day). If you were simply following the swing highs and lows (assessing trend according to 3S or 1-2-3 patterns), then it might have been relatively easy to follow.

But what if you were able to confirm your trend bias with a chart that showed (end of day) the major trend based on an average calculation of price including opening, high, low and close? And what if the directional bias were represented via color in a more orderly fashion?

It might look something like this:

 The two words that might best describe this price chart in comparison with the previous two are detailand clarity.

It certainly has a lot more detailthan the line chart (though not as much as the candlestick chart).

But in terms of trend analysis, it has a lot more claritythan the traditional candlestick chart (though not as much as the line chart).

These are two beneficial characteristics of Heikin Ashi Candlesticks.

 Reading the Heikin Ashi

Let’s compare how both forms of candlestick charting represents price action. How did this…

…become this?

Apparently, the trend direction is much clearer in the Heikin Ashi (second) example.

But to understand how this chart filters prices in order to present a clearer trend bias, it’s best to understand how the chart is formulated. Let’s take a closer look.

 We offer a full Heiken Ashi day trading course here.

  Heikin Ashi Calculations

Heikin Ashi Open  = (Open of previous bar + Close of previous bar) / 2 Heikin Ashi High= Highest of High, Open, or Close Heikin Ashi Low= Lowest of Low, Open, or Close

Heikin Ashi Close= (Open + High + Low + Close) / 4

Note that the smoothing operation is due to the averaging-out of various price levels. This means that actual price movements will occur around the represented price.

Caveat:

For swing traders and position traders who trade end-of-day, this should not pose a problem.

But for day traders who trade intraday in response to immediate price movements, this might be problematic as a day trader would have to wait until a “candle” or bar had been completed–a delay that might compromise a day trader’s ability to be responsive to the markets.

 Applying the Heikin Ashi

When using heikin ashi, you can treat it the same way as you would a traditional candlestick chart. The difference is that prices have been smoothed-out to reflect directional bias.

As with candlesticks, you might use chart patterns with a heikin ashi, but your view might be better informed by the consistency in the color coding, which may indicate reversal bars more clearly, sometimes more accurately.

 Traditional Candlesticks

 Heikin Ashi Candlesticks

 For instance, in the YM chart above, the consistency in color coding might have added clarity to the V bottom and breakout at [1].

The swing low support lines at [2] are emphasized a bit more clearly, and the bullish/bearish lines in the rising wedge at [3] are a bit less noisy as compared with its traditional candlestick counterpart.

You will also note that the 38.2% retracement at [4] is just as clear as the traditional candlestick version, but that the directional bias upon the breakout at [5] has filtered-out the bearish candles which might (or might not) have indicated a potential weakening post-breakout.

Let’s take a look at the ZW (wheat futures) chart and parcel out the main lines of movement.

If the devil is in the details and the insight in the nuance, then how might a traditional vs heikin ashi candlestick chart affect the way you see and interpret price movement?

 Traditional Candlesticks

 Heikin Ashi Candlesticks

 The heikin ashi’s rendering of spatial order and color sequences provide greater clarity in boxes [1] and [3]. Box  [2], though still clear, contains more counter-movement.

At this point you’d have to ask yourself whether the heikin ashi candles might provide greater interpretive clarity when making trading decisions, or whether it would serve as a biased distraction.

For traders who find the filtering effect of these nuances beneficial, heikin ashi candlesticks may provide a versatile means–if only as a second-looktool–to interpret directionality in a manner that compliments traditional chart pattern analysis.

Perhaps this is the most useful aspect of the chart: a way to see price patterns from a more directional angle, a way to take an “x-ray” (however biased) of a pattern’s trajectory at the expense of some movement, and a means to minimize detail in order to derive an essential representation of trend.

 And if you want to take your Heiken Ashi trading to the next level, we offer a full Heiken Ashi day trading course here.

 The post Heiken Ashi Candlestick Trading Explained appeared first on Tradeciety Trading Academy.

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Learn how to trade and use Point and Figure Charts

“Point and figure” charts – what are they and how to trade them

Do you want to know what is the difference between Point and Figure Charts and Kagi Charts? Watch our latest video to learn how to read point and figure charts and how to trade them.

Point and figure Charts – How to trade them

Hello and welcome to Diary of a Trader. And in today’s video we’re going to go over another type of chart option, that’s called, “Point and Figure”. You’ve probably seen this before. If I go up to the TradingView’s different types of charts that I can look at where we have Bars, Hollow Candles, Heikin-Ashi, Line, Area, Baseline, Renko, Line Break, Kagi, all those, but what we want is Point & Figure. And Point & Figure is going to be a lot like Kagi, or Renko, or Gann’s Swing Charts, you know, where with Kagi charts, there is no time involved. Point and  Figure is only a price driven style and that is all we need to worry about is just price and we’ll notice that we have Xs and Os and ultimately, you know, this is just time-based price movements that don’t take into consideration the time. And if we look at this, we see that the Os represent bearish movement and the Xs represent bullish movement. And right now, by default, what TradingView will do, is will set it to ATR and the reversal amount is shown as 3, so that means that we would need three of the Xs or Os to form a new line, and each line or column, as they’re called, is only going to have Xs or Os. So the ATR it says is 0.00015. The problem with ATR is that it changes and adjusts so it could change from one moment to the other, so I like to use, I’d recommend that you use the Static setting, so I could go with the Box Size, so each X or 0 is going to represent 5 pips. And then, the reversal amount of 3, means that when there are 3 or 15 pips of movement, that’s going to reverse the candlestick or, sorry, rather the direction and paint the Xs or the Os. So, if we’re looking at this Pound/Dollar chart, we can see it’s a very actually clean chart because we can really identify where a lot of our trend lines are going to go. So, we can see there’s a trend there, we have a short-term trend down here, we can draw our Fibonacci levels like we have sitting here. Let’s actually draw our Fib level from this swing to swing, for a long-term Pib swing and then we could also draw it from the most recent swings as well, from here to here.

And so, what is a common way to trade Point and Figure charts is that, let’s say that we know we are in a kind of a consolidative zone here, what we would look for to do is, let’s say we are trading in this range here, then we would probably want to put a buy level above the X of the prior column. That would be a good buy entry. Also, a good sell entry would be if we were trading up here, we took profit, we saw a low was made, but it didn’t breach a prior column low, we just keep looking and looking, and then finally, when we see that there is price that moves beyond the previous low of a column, that’s when we would enter in a short. And we can see this kind of progress as we go along. It’s also very easy to spot areas of support and resistance because they’re very flat levels. You know, for some people the 5 pips is too fast so we could actually go to 10 pips if we want, and then it will reduce the trade opportunities you have, but it will give you more accurate changes. That’s kind of the danger with a lot of these price-only based charts, like Renko and Kagi charts, and range-based charts and then we have the Point and Figure is that you can be stuck at a certain column for quite some time before it changes, but at that same time, you know, when you have a smaller brick or a smaller box size, then you run the risk of getting into a lot of false breakouts or you can end up just getting in and out of trades too fast. But then, the problem is you think, well I should go with a longer time frame or not a longer time frame, a higher box size, you get into the problem then of not getting very many signals and so that can sometimes bother people too. But the signals that you would get on the longer time, not the longer time, from the higher box count, are going to be more representative of an honest and sustained move. So, certainly, as we see here, in the most recent price action, we see that, when price rallied up a little bit and then we formed a new column of Os, when we broke the prior low there, you know, we can see, or actually, if you didn’t want to break the prior low, you could draw a triangle and there was a triangle there. When we broke that and painted a 0, then certainly the short trader was correct.

So, what are we looking for here, right where we’re at, well, the close here, on the circle, was 1.3160 and so, we are at a 10 pip count brick, so that means we would have to trade up 30 pips from here, so we would need to trade up to 90. So, once we got up to 1.3190, we would end up painting our green Xs on here and then that would tell us that we are getting close to some type of reversal. And then, ultimately, let’s say we had those green Xs fill up this entire column here, where would our buy entry be? We have a couple of options. We could buy up on the re-entry into this upwards trend line, or we could wait until we broke the previous X, the high of the previous X, we could trade that there too. So there’s a couple of options but Point and Figure charts, this is an old school way of looking at charts, it’s been around for quite a long time. It’s a very, very, very effective form of trading. In fact, if we use the Ichimoku or not the Ichimoku system, the Volume Profile, that is another tool in our trading toolbox that helps us with trading the Point and Figure charts. Point and Figure charts, again, just like Renko, if you are somebody who struggles with candlesticks and interpreting candlesticks or gets whips out of too much candlesticks, then maybe something like Point and Figure is that chart for you because not everybody can trade candlesticks. It’s not meant, you know, there are various chart styles because they adapt to certain people so yeah. Hope you guys found this video interesting and I look forward to talking with you in our future videos! Bye-bye.

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