Many asked about the black candle and hollow red candles:
The meaning behind the black candle:
A news or some other unexpected event triggered a sudden gap up at mkt open, many DT jumped in to buy (including some panic short covering) in the fear of miss the break out or possible rally extension, but during the day, constant selling kicked in after the initial excitement fades, and early morning DT's daily stop order got triggered and stopped out... some trapped... but the selling is not stop and most time you will see the lowest spot shows up 1 hours before the mkt close and there will be some last minute buying to push it up and still make the close above the previous day close, this last minute buying are mostly triggered by the DT short covering and profit taking not because of the new long buying, because most morning gap chase long buying power was stopped out or trapped in there after the early morning actions after open.
So, sometime I call this kind of action as "DT killer action", since most DT traders only has one set of fund to do trading, if one is a little bit hesitation in using of the stop... he will be trapped and force to cut and bail sooner or later... I also read this action as a confidence fading action in bulls... if this kind of candle happened near a major resistance zone after a sizeable bull rally, then the chance to see a big correction will be very high, sometime it will turn into a major mkt top...
Similar, action to those hollow red gap down candle... those are the sign of bear dead...
[ 本帖最后由 秋之皓月 于 2008-5-3 16:10 编辑 ] |