Feature Archives

Buying a Computer

Trends in the computing industry and issues to consider before purchasing a new computer or upgrading your current system.

ETFs

Analyzing, selecting and trading exchange-traded funds

Investor Sentiment

Using investor sentiment to indentify tops and bottoms in the market.

Market Breadth & Timing

Market breadth and momentum indicators to gauge the market's overall direction.

Mutual Fund Screening & Analysis

Screening for and analyzing mutual funds.

Portfolio Management

Constructing a portfolio of investments and the issues involved, including risk management.

Software Reviews

In-depth reviews of some of the most popular investment-related software.

Stock Screening & Analysis

Using quantitative stock screening filters to identify possible investment and analyzing individual stocks.

Stock Valuation

Determining the "true worth" of a company.

Technical Analysis & Charting

Using technical indicators and charts to help time your buy and sell decisions.

Tax Preparation

Using computerized tools and resources to prepare and file your personal income taxes.
Computerized Investing > July/August 2007

Introduction to Candlestick Charting

PRINT | | | | Add your comment! | A A   Reset

by Wayne A. Thorp, CFA

Modern-day technical analysis is typically traced back to Charles Dow around the beginning of the 20th century. However, almost 300 years earlier, the Japanese were using similar techniques focusing on price behavior and patterns to trade rice contracts. Out of this came candlestick charts, which appeared in the second half of the 1800s. After hundreds of years of modification and refinement, candlestick charts are popular among day traders and buy-and-hold investors alike.

Like all forms of technical analysis, candlestick charting attempts to forecast the future price movements of a security by examining its past price behavior and the patterns that appear on a historical chart.

Here we will offer an overview of candlestick charts and highlight the significance of some different types of candlesticks. To illustrate our examples, we will use a few popular charting Web sites. For more information on Web sites offering candlestick charts, refer to the “Technical Analysis and Charting Web Sites” Comparison article in the March/April 2007 issue of Computerized Investing (available on-line at AAII.com).

...To continue reading this article you must be a Computerized Investing Subscriber.

Gain exclusive access to this article and all of the benefits and investment education a Computerized Investing subscription offers.

SUBSCRIBE TODAY for just $24.
Log in
Already a CI subscriber? Login to read the rest of this article.

Subscribe
A subscription to Computerized Investing includes a monthly email and access to the CI Website, all of which aim to benefit your investing skills with respect to computers and the Internet.

  


Discussion

No comments have been added yet. Add your thoughts to the discussion!

You need to log in as a registered AAII user before commenting.
Create an account

Log In