However, based on my research, it is unlikely that Homma used candle charts. They are often used today in stock analysis along with other analytical tools such as Fibonacci analysis. They were introduced to the Western world by Steve Nison in his book Japanese Candlestick Charting Techniques, first published in 1991. History Ĭandlestick charts are thought to have been developed in the 18th century by Munehisa Homma, a Japanese rice trader. They are visually similar to box plots, though box plots show different information. They are used by traders to determine possible price movement based on past patterns, and who use the opening price, closing price, high and low of that time period. It will, however, open new avenues of analysis and will show how Japanese candlesticks can “enlighten” your trading.Candlestick chart of EUR/USD currency pair on daily timeframe in MetaTrader 5 trading platform.Ĭandlestick charts are most often used in technical analysis of equity and currency price patterns. This book will not give you market omniscience. This will slowly and clearly lay a solid foundation for the second part where you will learn to use candlesticks in combination with Western technical techniques. In the first part of the book, you learn how to draw and interpret over 50 candlestick lines and formations. If you subscribe to one of the multitude of services now providing candlestick charts and would like to learn how to use these charts, then this book is for you. If you like reading about colorful terminology like “hanging-man lines,” “dark-cloud covers,” and “evening stars” then this book is for you. markets, but the tools and techniques in this book should be applicable to almost any market. Using candlesticks will help improve your market analysis. Candlesticks are exciting, powerful, and fun. Japanese candlestick charts are older than bar charts and point and figure charts. You should find it valuable no matter what your background in technical analysis. Would you like to learn a technical system refined by centuries of use, but virtually unknown here? A system so versatile that it can be fused with any Western technical tool? A system as pleasurable to use as it is powerful? If so, this book on Japanese candlestick charting techniques is for you. They can be used for futures, equities, options, or anywhere technical analysis is applied. Candlestick techniques can be used for speculation and hedging. By reading Japanese Candlestick Charting Techniques you will discover how candlesticks will add another dimension of analysis.
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