Page 22 - MFX Reversal Patterns C.M

Questions to ask yourself while

you do the analysis?

THE CURRENT CANDLE:

The size of the body?
The candle body is a great starting point because we can get a lot of information from it. A long body is showing strength

when bodies become larger it shows momentum . When bodies become smaller, it shows slowing momentum. The body
shows the range over the duration of the candle .

Larger or smaller than the previous ones? Is the size changing meaningful or not?

Is the change happening during an inactive trading period?
For example, candlesticks on EUR pairs they tend to shrink in size during the quieter Asian session.

The length of wicks?
Wicks can show the volatility of price movements. Larger wicks show that price has moved a lot during the duration of

the candle, but it got rejected. When candle wicks become larger it shows an increase in volatility. This often happens
after long trending phases before a reversal happens. Or at major support and resistance levels.