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Forex Candlestick Reversal Patterns

A personal story...

I have read Steve Nison's books on the subject of Candlesticks and Candlestick patterns, I have printed reams of paper on the subjects, learnt Japanese names and even made up some of my own (don't ask!).

With over 20 years experience of these patterns I can say with confidence that these 3 core reversal patterns (6, if you include Bullish and Bearish) are all you need to know. The exception here is perhaps the 2 Candle reversal pattern which I also pay attention to, although not so much.

To me Candlestick patterns on the 1 hour time frame and less, perhaps even the 4 hour too, are quite useless. I say this because the pattern is a supposed to be a representation of the "crowd" and the "crowd" does not trade within the boundaries of a 5 minute, 1 hour or even 4 hour time frame.

If however I see one of these Candlestick patterns on the Daily or Weekly time frame I have much more confidence. The majority of the market has usually played their hand within this time frame thus, the higher the time frame the more emphasis I place on these Candlestick patterns.

On the 1 hour time frame or less, to me they mean nothing on their own.

The PAST MT4 Indicator included in the Forex Useful MT4 Indicator Bundle is a great tool for spotting these reversals, and others, on any time frame.

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