|
Step 1 -
Look for a BEARISH HARAMI against MINOR PRICE
RESISTANCE, and/or against a declining Major
Moving Average (10 MA, 20 MA, or 50 MA) on the
daily chart.
Step 2 -
Pull up a 15 min. chart of the stock.
Step 3 -
Note the low price of the previous day's
daily HARAMI candlestick.
Your entry point is 1/8th below
this price.
Step 4 -
On the following day, allow the
stock to trade for 5 minutes before entering.
Sell short the stock only if it breaks below the
entry criteria (1/8th below the previous day's
low) and only after it has traded for 5 minutes.
If the stock does not break below the entry
point, do not enter.
Step 5 -
Place the initial protective stop 1/8th
above the high of the previous day's HARAMI
candlestick. Cover the stock for a small
loss immediately if the stock breaks above this
price.
Step 6 -
Monitor the stock as it continues to decline
downward. Look for areas of
resistance (either minor price resistance or
base price resistance) on the 15 minute chart,
and re-adjust your protective stop price
downward as the stock continues to
decline. This will protect your
profits, and/or minimize your losses if the
stock should turn against you.
Step 7 -
Monitor the stock on a 15 min. chart as it
declines downward, and stay in as long as the
protective stop is not violated. Allow the
stock to achieve 1 point or greater profit, and
then look for signs of strength. A
reversal candlestick pattern on the 15 minute
chart will serve as a good indicator for a
reversal point. After the price
reaches an area of support and strength, cover
half of your position. This may occur on
the same day of entry, or on the following day,
depending on the weakness of the stock.
Maintain the latest protective stop price for
the remaining half of your position.
Step 8 -
Allow stock to continue it's decline.
After the stock has declined further, again look
for an area of support where the stock begins to
strengthen and reverse. This could be a
DOJI candlestick, or any other reversal
candlestick pattern on the 15 min. chart.
Cover the remainder of the position for profit.
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
| 