Candlesticks - Vol 6 - Hanging Man

http://www.YourTradingCoach.com - Candlestick Charting - Vol 6 - Hanging Man

Duration : 0:7:34

4 Responses

kxcxixn Says:
October 12th, 2008 at 12:12 pm
yeah, i guess that …
yeah, i guess that does make sense–thanks for the response!

take care.
YourTradingCoach Says:
October 12th, 2008 at 12:12 pm
(continued from …
(continued from previous response)
With hanging man, candle gaps up to open at new highs, but is then driven strongly back down. The bulls manage to drive it back up this time (therefore it’s not as bearish as the shooting star), however the pattern has shown strength in the bears. If we get subsequent confirmation through price below the pattern again, bulls will sell adding selling pressure to the bears. Therefore bearish pattern (but only after confirmation).
YourTradingCoach Says:
October 12th, 2008 at 12:12 pm
Hi kxcxixn,
Think …
Hi kxcxixn,
Think of the psychology of both bulls & bears in each pattern. With shooting star - price rises from lows to high, and is then driven very convincingly back down to close at or near low. Bears have played a strong hand. Bulls will doubt their position, and some will exit on continuation of the move below the candle (adding selling pressure to the current bears). The shooting star is therefore a bearish top reversal pattern. (cont. in next response due out of room)
kxcxixn Says:
October 12th, 2008 at 12:12 pm
this is what I dont …
this is what I dont get: shooting star and hangman seem to be opposites, yet they both result in the same downward moving trend–why is that?