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Step 1 -
Pull up a Weekly chart of the stock after the market
close for the week (Friday after close).
Step 2- Look
for a THREE BLACK CROWS resting on MINOR PRICE SUPPORT,
and/or a rising Major Moving Average (10 MA, 20 MA, or 50 MA)
on the Weekly chart. Place the stock
on your watch list for the upcoming week.
Step 3 -
Allow the stock to trade one full day. Pull up a Daily chart of the
stock after the stock has formed the first daily
candlestick of the week (Monday after close).
Step 4 -
Look
for a BULLISH HARAMI candlestick resting on MINOR PRICE SUPPORT,
and/or a rising Major Moving Average (10 MA, 20 MA, or 50 MA)
on the Daily chart.
Step 5 - Enter
the stock only if it breaks 1/8th above the high of
the previous HARAMI candlestick. If the stock does
not break the previous day's high, DO NOT
ENTER THE TRADE.
Step 6 - Mark
off the 50% retracement line. This will be the halfway
point between the line of support where the stock
began it's rally, and the line of resistance where the
stock made it's last major pull-back.
Step 7 - After
entry, place
an initial protective stop 1/8th below the low
price of the previous day's candlestick.
Sell the stock immediately if the stock breaks below this price.
Step 8 - On
each new day, adjust the trailing protective stop to 1/8th
below the previous day's candlestick's low price.
Continue to use a trailing stop as long as the stock
remains below the 50% retracement line.
Step 9 -
After the stock has broken above the 50% retracement
line, look for a reversal candlestick. This will
most likely be a bearish candlestick which closes near
it's low price of the day. Sell the stock for
profit either before the market close, or at the
market open the next day.
If you have any questions regarding this report or the CANDLESTICKSHOP.COM
website in general, please do not hesitate to contact the author at info@candlestickshop.com
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