Candlestick Corner  |  DEC 2001

Continuation Patterns by Amy Wu

Continuation Patterns by Amy Wu The rising three and falling three candlestick patterns can help you confirm trends, add to positions,and grant you a cease-fire from the battle between the bulls and the bears. Candlestick charting extends well beyond confirming support and resistance levels and predicting market tops and bottoms. Active markets always attract traders, but sometimes recognizing market inaction is as necessary as finding activity in the market. There are times to sell, times to buy, and times to rest, and the continuation pattern recognizes those times to rest. But just because the market is resting doesn’t mean you should be. Continuation patterns are an excellent way to confirm trends, add to positions, or even trade on the short side. CANDLE BASICS REVISITED Candlesticks, which originated in Japan several hundred years ago, are a unique and subtle way of looking at charts. Usually, we think of bars when we want a security charted. But candlesticks are only a different form of bar charts, a form that lends greater insights.

by Amy Wu