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Course: The art of Japanese Candlesticks

Lesson Insights

Candlestick vs CandlePower

Candlesticks and CandlePower are two different technical analysis tools used to represent the price movements of financial assets. Here's a comparison between them:

  • Calculation Method: Candlesticks are calculated using the opening, closing, high, and low prices of an asset for a specific time period, whereas CandlePower uses the relationship between price, volume, and volatility to create a unique indicator.
  • Visual representation: Candlesticks use color to distinguish between bullish (price rising) and bearish (price falling) market conditions, while CandlePower uses a histogram to show the relative strength of buying and selling pressure.
  • Interpretation: Candlesticks are often used to identify short-term price trends, while CandlePower is designed to provide a more comprehensive view of market sentiment by combining price and volume data.
  • Trading Signals: Candlesticks can be used to generate trading signals based on specific patterns, such as Bullish Engulfing, Bearish Engulfing, and Hammer CandlePower, on the other hand, provides a more quantitative signal that can be used to confirm or contradict price movements indicated by other technical indicators.

In summary, both Candlesticks and CandlePower are useful tools for technical analysis and can complement each other in providing a more complete picture of market trends. However, it's important to understand their calculation methods and visual representations, as well as their strengths and limitations, when using them to inform your trading decisions.

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