Price trend and price averagesCandlestick charts: CandleScanner color themeShort and long linesBlended candlesticks

Probably one of the easiest ways to determine trend is the use of moving averages. Moving average is simply an average of prices (for example close prices) for a certain number of candles. The shorter the period (fewer candlesticks) to calculate an average the more likely is to be dominated by noise, rather than reflect…

[frame align="right" width="770"] [embed]http://youtu.be/UW7gkcpsjT0[/embed] [/frame] Almost all of the western literature devoted to candlesticks has simplified the analysis by limiting the candle colors to dark (black) and light (white) body. According to Seiki Shimizu, the colors of candles were originally much more complex, which he demonstrated in the example of a doji candle, in which…

[frame align="right" width="770"] [embed]http://youtu.be/3jKZuMM9hlk[/embed] [/frame] Candles differ in length, which is shown in the division of the candle. The criterion for this division is fluid and depends on the current situation on the chart. The so-called short line is the one where the market volatility is very low (small price range). Similarly, the long line…

We can ‘blend’ different adjacent candlesticks to form a single candlestick, thus summarizing the outcome over several periods in one candle. We can blend candles of similar frequency over any time scales, for example, minute-by-minute candles, hour-by-hour candles or day-by-day candles. You can blend as many adjacent candles as you see fit. In effect, by…