Trading Strategy Using the Formations of Japanese Candles

The formation “shooting star” represents  decreasing  Japanese candlestick (colored in white).  First it is necessary to have an increasing candle or a series of  increasing candles as in Figure 1 .  in order to create a shooting star.  The shooting star’s shadow which is above it has to be twice and a half  times bigger than actual body of the candlestick. After the formation has already been finished ( a series of rising candles, the last of which is lengthened)  the shooting appears-  it doesn’t matter what kind of  candle we have.  The formation of the  shooting star is a bear signal that indicates a decrease of the price.

In the figure 1 we can see where exactly the price is situated  after the appearance  of  “shooting star”  formation. In case we are trading with binary option we can use it  for options that continue several hours- for example if the signal is shown on the  hourly chart you can use options with a expiry of at least 4 hours.

 

Shooting-Star1-fig1

shooting star2-fig2

This Trading Strategy is provided by Dimitar Petkov

 

The charts and strategies in this article do not comprise any form of advice or recommendations by ActionBinary.com to buy, sell (or refraining from making) any trade or investment. It is recommended that you seek independent advice before entering into transactions.

 

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