As of 01/29/2025   Indus: 44,714 -136.83 -0.3%     Trans: 16,658 -36.17 -0.2%     Utils: 982 -1.68 -0.2%     Nasdaq: 19,632 -101.27 -0.5%     S&P 500: 6,039 -28.39 -0.5%	YTD  +5.1%    +4.8%   0.0%    +1.7%    +2.7%	Targets    Overview: 01/15/2025     44,000 or 45,250 by 02/15/2025   17,200 or 15,700 by 02/01/2025   1,050 or 950 by 02/01/2025   20,500 or 18,670 by 02/01/2025   6,200 or 5,900 by 02/01/2025
Chart Pattern Indicator: on 1/13/25

As of 01/29/2025   Indus: 44,714 -136.83 -0.3%     Trans: 16,658 -36.17 -0.2%     Utils: 982 -1.68 -0.2%     Nasdaq: 19,632 -101.27 -0.5%     S&P 500: 6,039 -28.39 -0.5%	YTD  +5.1%    +4.8%   0.0%    +1.7%    +2.7%
Targets    Overview: 01/15/2025     44,000 or 45,250 by 02/15/2025   17,200 or 15,700 by 02/01/2025   1,050 or 950 by 02/01/2025   20,500 or 18,670 by 02/01/2025   6,200 or 5,900 by 02/01/2025
Chart Pattern Indicator: on 1/13/25

Bulkowski's Candlestick Tip

This article discusses one candlestick tip that says the position in the yearly price range is important to performance.

This is one of the discoveries I made and discuss in my book, Encyclopedia of Candlestick Charts. In each candlestick chapter, I sort candle performance into the yearly price range, just to see if a trend develops. Most of the time, candles that showed the highest post breakout move began their life within the lowest third of the yearly price range. Here are the results.

As an example, the bullish belt hold candlestick in a bear market after a downward breakout drops an average of 11.21% for those candlesticks within a third of the yearly low. Belt holds in the middle third drop 9.35% and those with breakouts in the highest third drop 7.76%. The other breakout directions (up/down) and markets (bull/bear) show similar results, but check the candlestick type you are interested in. The decline in this example measures from the breakout to the trend or swing low (often the nearest minor low).

Knowing that candlesticks within a third of the yearly low tend to be more reliable (meaning price trends farther than otherwise, so you are more likely to walk away with a profitable trade) is the kind of information that gives traders like me an edge. And you can buy that edge from Amazon at the link. Just click on the book picture and it will take you there.

-- Thomas Bulkowski

See Also

• Two candlestick tips could improve profitability.
• Busted chart patterns. The answer to profits?
• Congestion quiz. Which is best, a straight-line run or congestion breakout?
• How to pick stocks, part 1.
• Premature buying. Learn how to prevent buying too soon.
• 3 tips to help you pick stocks.

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