Candlestick patterns-Intraday-ES, US, Euro

Discussion in 'Index Futures' started by Century, Oct 20, 2003.

  1. Century


    Starting a thread to discuss intraday candlestick based observations in the Emini, ACE Bond, and the Euro futures(all December right now)

    Candlestick followers please post your observations, ideas, trades, etc.

  2. Century


    Dec E-Mini ESZ03(5 min) - Nice evening star formation around 10am ET, no gaps however, tough to get gaps on intraday, high Stochastic, high CCI, good for a few pts. Also a tweezerish almost bearish engulfing around 1pm ET, did not move far though.

    Dec ace Bond USZ03 - nothing jumped out at me.

    Dec Euro future ECZ03 - 2-3 Dojis around 8:40am ET called end of the downtrend.

    Got to go.
  3. post charts
  4. My discussion of this trade signal is for those traders using intraday candlestick patterns and trading via size.

    These are charts of missed trade signals. I keep an in-depth intraday candlestick private journal and one of the major features of the journal is keeping detailed trading notes of missed trade signals.

    (Note: My public journal is a scaled down version of my private trade journal)

    Advanced Tweezer Bottom 102203

    Advanced Tweezer Bottom 102103

    Bullish Harami 102003

    This particular trade signal is a price action only method (no indicators) that's dependent upon intraday candlestick analysis, volume analysis and a little tape reading.

    I won't go into all the in-depth criterias of the trade signal because you can study the charts and figure that on your own.

    However, here are the basics of this trade signal:

    1. Reversal candlestick patterns continuation patterns, no exhaustion patterns and no non-recognizable patterns.

    2. My favorites for this particular signal are Bullish Engulfing, Bullish Harami, Bullish White Hammers, Advanced Tweezer Bottom and Bullish Piercing.

    3. The Key Candle that's been pointed out in the charts is critical.

    Study it well, study the comparison of the body range of the key candlestick in relationship to the body range of prior candlesticks...reveiw all your past charts to find commonalities.

    4. Trade management (what occurs after entry) is important.

    Eminis will wiggle a lot after entry.

    5. Place a hard initial stop/loss protection...none of that mental stop stuff.

    Initial stops have a take you out of the trade because you are wrong in your analysis.

    6. Volume analysis and a little tape reading skills is required.

    These are complicated subjects.

    However, start doing live-recordings of your charts including Times & Sales for study at a later date.

    Camtasia Studio

    7. I use 3min all session charts for this signal. In fact, I've never used any other chart interval for this signal mainly because I'm too lazy to research such.

    8. I only trade size with this trade signal...a minimum of 3 contracts...

    Once again, this trade signal is only for those already trading size...such is part of the edge with this signal.

    (Currently...the overall market environment has me small size on Long positions)

    Basic Exit Strategy: I'm looking for quick profits (often the 1st profit-target) on 2/3 and immediately moving the initial stop up to breakeven for the remainder.

    The real goal is the remainder...a remainder that attempts to capture the 2nd profit target or even a possible 3rd profit target depending upon the strength of the trend.

    Once hand holding from me because its critical you learn intraday candlesticks via your own trade methodology...

    Thus, study the charts I've linked to and then study all your historical intraday charts to find similar like candlestick patterns...

    Print them out...don't study them on your computer monitor.

    My observation is to not look at intraday candlestick patterns to find tops and bottoms because in reality...

    the purpose is to look for reversal signals and I don't care where such reversal signals occurs.

    Therefore, the above intraday candlestick patterns for this signal fits well with my trade methodology as a trend reversal trader.

    In addition, my definition of a missed trade signal is this...

    A trade that snuck by me while I was watching the charts looking for a trade signal...

    an intraday candlestick pattern being noticed within 15 minutes after the fact...

    I can easily do a quick review at that time, make trading notes while still within the residual environment of the candlestick signal...

    (I can still feel the market)

    something I can't do via hindsight charts long after the fact although it's hindsight charts I've posted here.

    Last of all...if I have time and depending upon the type of replies in this thread...

    I'll post more missed charts of intraday candlestick trade signals...

    just annotated charts and no long-winded message post like this to go with it.

  5. Niha...great post with some excellent chart shots! Candle stick patterns are very significant for trading in the ES as I have learned over the past three months from you (I did not use candles at all until about July of this what a difference). The only thing I have to add for the Bullish Harami example, is the high of the open (1040) could be a second profit target for this example. Then a third profit target could be the after opening push high of 1041.75. the only reason I say this, is because of how the price action acts when it is in the area of the "days opening" price levels. Also, 1040 seemed to play a role in the price action from the end of the previous trade day (looks like resistance area), and the push after the open in the current trade day failed to use 1040 as support (only held for two candles 10:00 and 10:03 before price dropped on the 10:06 candle). Niha keep the charts coming... this is great way for us to learn how important the "Japanese Candlestick" patterns are for trading the ES.

    Thanx Again!

  6. Intraday Japanese Candlestick Pattern:

    Bullish Engulfing (Long signal) 1006am est at 1052.50

    Entry Range: Between 1052.00 - 1053.25

    Reason for Missed Trade Signal: Baby diaper change lasted longer than expected while I was taking care of the baby while spouse was grocery shopping.

    To understand the basics of this price action only method...see my initial message post in this thread.

  7. Intraday JC Pattern:

    Advanced Tweezer Top and Bearish Divergence (Price Action Only Method) 0836am est at 1063.25

    Entry Range: Between 1062.50 - 1063.50

    Reason for Missed Trade Signal: Overslepted and it was costly because I normally trade any trade signals that appear via pre-reaction or post-reaction to 0830am est key economic reports.

    To fear volatility is to fear profits

    Further, I rarely miss 0830am est opportunities and although I wasn't at the computer when this particular signal occurred...

    I will count this as a miss trade.

    Note: My Camtasia Studio program did record the price action (live-recording) starting at 0800am est via me briefly getting up out of the bed to start everything in thinking a quick 20min of extra sleep will be good.

    Therefore I still have a way to learn from the signal(s).

    Multi-Pattern Trade Signal

    The above chart reflects what I call a Home Run trade via several contracts. I try to catch at least one of these per month...

    many days remaining in this month after missing my first big opportunity :cool:

    Also, there's probably hundreds of different ways to use pivot point analysis...I mainly use it as profit-targets whenever I do use pivots in certain trade situations like Outside UpGap Days...

    see attached chart because it is correlated with the above chart.

    Profit-Target 1 is based on candlestick support analysis (quick profits)...

    Profit-Targets 2 & 3 are based on pivot point analysis (requires patience and the ability to trade size).

  8. My last post in this's basically a dead thread...

    surprises me because the thread starter Century has an extensive database of candlestick information and isn't posting to encourage the thread.

    Intraday JC Pattern:

    Bearish White Shooting Star in Harami position with Bearish Divergence (Price Action Only Method) 0954am est at 1062.50

    Entry Range: Between 1062.00 - 1063.25

    Reason for Missed Trade Signal: I actually shorted a few minutes earlier via an advanced candlestick pattern but missed the opportunity of adding to a profitable position to load up on the contracts when I saw this particular candlestick pattern.

    Something else...I know too many traders that complain about the lack of volatility in this market when they compare it too the volatility of past years.

    However, they are the first to ignore volatility via the result of key economic reports or ignoring volatility that appears for no apparent reason (reason usually discover later)...

    believing the myth its best to ignore the first hour of trading or avoid trading at/near key economic report releases or price action only methods is voodoo.

    To fear volatility is to fear profits

    Simply, a trade signal is a trade signal...don't ignore them no matter when they occur unless its a missed trade signal or your personal stats of your trades show a particular trade signal produces poor results in particular trade situations.

    Now that trade signal...

    Bearish White Shooting Stars are one of my favorite intraday candlestick patterns...especially this particular variation that I often call an Advanced Bearish White Shooting Star...

    I will count this as a miss trade because I rarely miss it or rarely miss adding more contracts via its trade signal.

    This is one of those high probability trade signals you get short immediately...not hanging around (hesitation) to contemplate what to do.

    Chart of trade signal is attached.

    P.S. Here's how important key economic reports are too some traders I know...

    They are successful fulltime traders...they don't trade on days when there's no key economic numbers and they usually are done trading by 12noon est unless there's something being released around 12noon or 2pm est...

    in which they will return to their computers at such time.

    Thus, no need to stare at your monitors all day to make a living in this market.

  9. NihabaAshi,

    I appreciate your fine information about trading with candles. It's helped me quite a bit. But I gotta ask why, and even how you can look at candlestick charts of such poor quality with candles on top of each other? It's hard to see where one candle starts and another begins. I don't want to dis you or your information in any way. I'm just curious why such a successful trader as you could stand to look at that all day. The program I'm using, InvestorRT, and I'm sure many others make very good looking candle charts.

  10. NA I gotta give you props for this sharing episode. It was nice sharing. Re: trading during report releases, do you wanna get hit with a 2 point ES slippage if you happen to jump on the wrong way train? Also where did the targets 2 and 3 come from on the chart.
    #10     Nov 15, 2003