A candlestick pattern that forms during an upward trend. This is what happens in the pattern: following a stretch of bullish trades, a bearish or black candlestick occurs; the opening price, which becomes the high for the day, is higher than the close of the previous day; the stock price declines throughout the day, resulting in a long black candlestick with a short lower shadow and no upper shadow. This pattern often signals a reverse in investor sentiment from bullish to bearish. However, the bearish belt hold is not considered very reliable as it occurs frequently and is often incorrect in predicting future share prices. As with any other candlestick charting method, more than two days of trading should be considered when making predictions about trends.
A type of candlestick pattern that is used by traders to signal a reversal in the current uptrend. This pattern is formed by three distinct candlesticks that show the following characteristics:1. The first bar is a large white candlestick located within a defined uptrend.2. The second bar is a doji candle (open equal to the close) that gaps above the close of the first bar.3. The last bar is a large red candle that opens below the second bar and is used to show the change in trader sentiment.As you can see from the chart below, the pattern is a charting signal that the uptrend is about to reverse. The bearish abandoned baby is a rare but reliable candlestick pattern that is useful in determining changes to a dominant uptrend. The accuracy of the reversal signal is greatly improved when it is used in conjunction with other technical indicators, such as the MACD and RSI, to confirm the reversal.
A graphical representation of a stock's movement that usually contains the open, high, low and closing prices for a set period of time. For example, if a technical trader is working with daily data, one bar is the set of quotes for one day. In the case of one-minute data, it is the price data for one minute. Also, if the data is displayed using a candlestick chart, one bar equals one candlestick or in the case of bar charts, one bar is equal to one bar.
A style of chart used by some technical analysts, on which, as illustrated below, the top of the vertical line indicates the highest price a security traded at during the day, and the bottom represents the lowest price. The closing price is displayed on the right side of the bar, and the opening price is shown on the left side of the bar. A single bar like the one below represents one day of trading. These are the most popular type of chart used in technical analysis. The visual representation of price activity over a given period of time is used to spot trends and patterns.
A band plotted two standard deviations away from a simple moving average, developed by famous technical trader John Bollinger. In this example of Bollinger bands, the price of the stock is banded by an upper and lower band along with a 21-day simple moving average. Watch: Bollinger Bands Because standard deviation is a measure of volatility, Bollinger bands adjust themselves to the market conditions. When the markets become more volatile, the bands widen (move further away from the average), and during less volatile periods, the bands contract (move closer to the average). The tightening of the bands is often used by technical traders as an early indication that the volatility is about to increase sharply.This is one of the most popular technical analysis techniques. The closer the prices move to the upper band, the more overbought the market, and the closer the prices move to the lower band, the more oversold the market.
A steep and rapid increase in price followed by a steep and rapid drop in price. Here is an example of a blow-off top, a steep rise followed by a steep fall. The rapid increase can be a result of either actual news or simply a wild rumor.
The most common type of distribution for a variable. The term "bell curve" comes from the fact that the graph used to depict a normal distribution consists of a bell-shaped line. The bell curve is also known as a normal distribution. The bell curve is less commonly referred to as a Gaussian distribution, after German mathematician and physicist Karl Gauss, who popularized the model in the scientific community by using it to analyze astronomical data. The highest point in the curve, or the top of the bell, represents the most probable event. All possible occurrences are equally distributed around the most probable event, which creates a downward-sloping line on each side of the peak.
A trend indicated by a large candlestick followed by a much smaller candlestick whith a that body is located within the vertical range of the larger candle's body. Such a pattern is an indication that the previous upward trend is coming to an end. A bearish harami may be formed from a combination of a large white or black candlestick and a smaller white or black candlestick. The smaller the second candlestick, the more likely the reversal. It is thought to be a strong sign that a trend is ending when a large white candle stick is followed by a small black candlestick.