Forex Candlestick Chart Patern – Doji
Well, now you know Doji right? Please see and read our article Forex Candlestick Chart Patern – Doji. In the article we mentioned that the Doji candle pattern is a neutral pattern. The power of buyer and seller is as large as open and close at the same price. There are even four variations of Doji patterns detected by analysts, that is distinguished by the shadow length (top and bottom).
In its development, analysts need more information from the emergence of this Doji candle pattern. So the research analysts about the pattern of Doji is tapered at one conclusion that the appearance of Doji can be an indication of reversal opportunities (reversal direction).
Then how is the indication of reversal opportunity? Let’s look at some of the following case studies.
Reversal means to change direction, eg from up trend then change to down trend or sideways and vice versa. Thus, the appearance of Doji as a reversal should be seen in previous trends or trends that follow. Or also see the previous candle.
In the first case study, the appearance of Doji after Long White Candle or after the uptrend. Trend up and long white candle can we interpret as the dominance of buyers who dominate the market thus pushing prices up. When Doji appears, where the power of buyer and seller becomes the same, then the previous upward trend becomes neutral. There is potential for further movement into sideways or reversal to be downtrend.
In addition to the perfect doji appearance, the Gravestone Doji candle pattern also provides the same chance implications. Gravestone Doji is described as a rally failure to rise so it closes at the same open level as the low level.
The second case study, the Doji appearance after Long White Candle or after the downtrend. Downtrend and long black candle can be interpreted as the dominance of seller who dominate the market thus pushing the price down. When Doji emerges, where the power of buyer and seller becomes the same, then the previous downward trend becomes neutral. There is potential for further movement into sideways or reversal to become uptrend.
In addition to the perfect doji appearance, the Dragonfly Doji candle pattern also gives the same chance implications. Dragonfly Doji is described as a rally failure down so it closes at the same open level as the high level.
We already know and get complete information about Doji appearance. We have to tell you that the two case study drawings above are commonly referred to as Patterns of Two Candles: Bullish Harami and Bearish Harami.