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  • Heikin-Ashi Candlestick Charts 1 comment
    Jan 3, 2010 2:20 PM | about stocks: QQQ, UNG, USO, DIA

    We are very please to release a new feature on MTR Investors Group the Heikin-Ashi Technique, developed by Dan Valcu, for creating candlestick charts. Once you start using Heikin-Ashi charts it is hard to use any other type of stock charts.   

    The heikin-ashi method {heikin means "average" or "balance" in Japanese, while ashi means "foot" or "bar") is a visual technique that eliminates irregularities from a normal chart, offering a better picture of trends and consolidations. Just by looking at a candlestick chart created with this method, you get a snapshot of the market's direction and strength.

    Compare the two charts below: PowerShares QQQQ Candlestick Chart vs. a Heikin-Ashi Chart.

    The heikin-ashi candlestick technique uses modified open-high-low-close (OHLC) values and displays these as candlesticks. The modified values are computed using these definitions:

     haClose = (O+H+L+C)/4
     haOpen = (haOpen (previous bar) + haClose (previous bar))/2
     haHigh = Maximum(H, haOpen, haClose)
     haLow = Minimum(L, haOpen, haClose)

    ScenarioTrendUp TrendDown Trend
    1Trend is NormalRising green bodiesFalling red bodies
    2Trend gets StrongerRising longer green bodies with no shadowsFalling longer red bodies with no upper shadows
    3Trend gets WeakerCandle bodies get smaller. Emergence of lower shadowsCandle bodies get smaller. Emergence of upper shadows
    4ConsolidationSmaller bodies with both upper and lower shadowsSmaller bodies with both upper and lower shadows
    5Change of TrendVery small body with long upper and lower shadowsVery small body with long upper and lower shadows

    You will only find these charts online at MTR Investors Group

    Themes: Heikin-Ashi, Candlestick Stocks: QQQ, UNG, USO, DIA
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  • Stefan Martinek
    , contributor
    Comments (3) | Send Message
    Smoothed Heikin-Ashi bars definitely perform better than the base Heikin-Ashi bars. The test on the large portfolio research different averages
    1 Apr 2013, 04:23 AM Reply Like
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