2. Candles Flashcards
What is a shift candle?
A candle that tries to take price out of the consolidation zone (a high volume candle)
Quick check of five candlestick colours
What does the red candlestick imply?
That the market maker has induced the retail trader to go short and is building his longs - he never buys at the highs!
What does the green candlestick imply?
That the market maker has induced the retail trader to go long and is building his shorts - he never sells at the lows!
How does the market maker induce the retail trader to go long?
By moving price away from the 50 EMA to the upside - notice the candle colours change at this point
How does the market maker induce the retail trader to go short?
By moving price away from the 50 EMA to the downside - notice the candle colours change at this point
A stopping volume candle looks like what?
A small body and a wick, with high volume (green or red)
The bigger the wick, the better the stopping power
I purple/violet candle implies that what?
Volume is starting to rise
A hammer candle that is coloured means what?
A stopping candle
When you see pins above the candlesticks, it means what?
They are working the highs, building shorts
When they are working the lows, and you see pins below candles that suggest that, what is their current thinking?
They favour higher prices
When pins are above the candles, the market maker is fulfilling what obligation?
The obligation to sell to the retail trader that is coming in and requesting to buy
The first profit from his short/long building is realised by the market maker at what point?
When price retraces back and touches the 50 EMA
Rewatch from about 10 minutes in as he runs through a scenario
Strong candles at the highs (i.e. away from the moving average) should make you think what?
Something is fishy, and things are about to change
