Cryptocurrency Spot Trading – What is Stop-Limit?
Аnalysis of Bitcoin | 3-Bullish Candlestick Line
There is a trend of rising and falling, reading the price language;
There is a signal to buy and sell, and bid farewell to feeling the deal.
In this session, we will learn various bullish Candlestick Line combinations, and show you the most effective ways to analyze them.
First, we will introduce “Dawnstar”, a visual sign indicates the start of an upward climb in cryptocurrency.
We have circled a Dawnstar in red line.
A standard ‘Dawnstar’ consists of 3 Candlestick Line.. The red line on the left is called a exterior circle. And the middle handle is a Doji. It looks like a + sign. located below the exterior circle.And the green line is a long Inner circle.
Here is the thing, whether it is a Dawnstar or not depends on the length of the third/Inner circle. the closing price of the Inner circle is the key indicator, it must meet 50% of the body of the first line.
Once we confirmed it is a Dawnstar. We can judge the bullish strength of the prevailing trend by a very important factor - the closing price of the “Inner circle”.We have 3 cases here: Generally, if the closing price just exceeded 50% of the exterior circle, the bullish strength is deemed as relatively weak.
If the closing price is very close to the opening price of the exterior circle, it’s considered that the bullish strength is relatively strong.
And finally, if the closing price far more exceeded the opening price of the exterior circle, the bullish strength is significantly strong.
What we have mentioned are just the typical examples of a Standard Dawnstar. However, the pattern of a Dawnstar varies in the market and is different from what we’ve just saw. So, we’ve extracted some real examples for your reference. Let’s go through them one by one!
Here are three types of “Dawnstar” with different patterns. And you’ll see how they look in the actual trend.Let’s see the first one. The middle line is not a “Doji” line, it looks more like a “T line” than a “+” line.
We can see the price dropped sharply. And then “Dawnstar” appeared. The price then stopped dropping and soared instead
Here is the second one. The Middle part is formed by 2 small candles.
While the price was going up, a “Dawnstar” appears. And the price kept rising after that.
Here comes the final combination. The Dawnstar is formed by 3 small candles or doji lines.
After the price dropped sharply, a Dawnstar appeared. And the price picked up quickly.
Next, we will learn about another bullish Candlestick Line combination, called “Bullish because of swallow”.
So, the main characteristic of Bullish because of swallow is that the green body covers completely the red body. That means the exterior circle is swallowed up by the Inner circle, indicating that the bullish power is making a big counterattack.
How to judge the bullish strength?
For figure 1, the green body just swallowed the red body, this combination suggested the weakest bullish strength;
For figure 2, the green body is significantly higher than the red body. Even twice the size of the red one. The combination represents a very strong bullish strength;
For the final case, the green body swallowed up many of the red bodies, and this one has the strongest bullish strength.
In the market, there are many Bullish because of swallow combinations that don’t look as perfect as the above cases. We will discuss some actual scenarios from the market.
We will show 3 Bullish because of swallow combinations, that the Inner circle didn’t cover the exterior circle completely.
For the first example, the price first dropped sharply, and it stopped after the Bullish because of swallow combination appeared. It then continued to rise.
For the second one, the Inner circle covered two exterior circles, forming a Bullish because of swallow pattern. And a bullish trend followed afterwards.
For the final case, the Inner circle covers 3 exterior circles, and the price raised sharply afterwards.
We will see the last bullish Candlestick Line combination, called Tower Bottom.
For a standard tower bottom, it is formed by a exterior circle, and followed a group of 5 or more small Exterior circle and Inner circles in the middle, and a long Inner circle at the right side.
The whole looks like an inverted tower, so it is named the bottom of the tower shape.
One important factor that makes an effective Tower Bottom is that the closing price for the last Inner circle must exceed 50% of the Exterior circle body at the front.
Once we know it’s a Tower Bottom, we can judge the bullish strength of the market by the closing price of the last Inner circle.
If the Inner circle ‘s closing price just passed the 50% line, the bullish strength is weak.
If the Inner circle’s closing price is close to the opening price of the exterior circle, the bullish strength is relatively strong.
And finally, if the Inner circle’s closing price is much higher than the opening price of the exterior circle. The bullish strength is significantly strong.
Of course, the tower bottom will not appear just like that in the actual trend. So, remember we have to be flexible. Let's take a look at what the actual "tower base" in the market is.
For graph one, the actual appearance is very close to the schematic diagram of the tower bottom.
This screenshot is from the 6-hour chart of the EOS/USDT in the
OKEx C2C trading area. We can see the tower bottom appeared in the uptrend, and it followed by a new round of upswings.
And this is anther variation. The middle part of the tower is not formed by very small candle, but a combination of long and short candles.
The screenshot is from the 12-hour chart of the EOS/USDT in the OKEx C2C trading area. After the price dropped heavily, a tower bottom was formed. The price then stopped falling and formed a reversal.
Finally, to wrap up everything we have introduced in the video:
There are 3 classic Bullish candles combinations.The first one is “Dawnstar”, suggesting a bright upcoming price upswing.
The second is “Bullish because of swallow”, indicating that the bullish power is making a big counterattack.
And the third one is “Tower Bottom”, suggesting an upside reversal.
Here comes the end of our section, we will show you the most negative ways to analyze various bullish Chart combinations,