Major Candlestick Signals

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The Bullish Harami signal is found at the bottom of a downtrend. Criteria:
1. The stock must have been in a definite downtrend before this signal occurs. This can be visually seen on the chart.
2. The second day of the signal should be a white candle opening above the Close of the previous day and closing below the Open of the previous day’s black candle.

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The Bearish Harami signal is found at the top of an uptrend. Criteria
1. The stock must have been in a definite uptrend before this signal occurs. This can be visually seen on the chart. 2. The second day of the signal should be a dark candle opening below the Close of the previous day and closing above the Open of the previous day’s white candle.

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The Piercing signal is found at the bottom of a downtrend. Criteria:
1.The stock must have been in a definite downtrend before this signal occurs. This can be visually seen on the chart.
2.The second day of the signal should be a white candle opening below the low of the previous day and closing more than half way into the body of the previous day’s black candle.

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The Dark Cloud signal is found at the top of an uptrend. Criteria:
1.The stock must have been in a definite uptrend before this signal occurs. This can be visually seen on the chart.
2.The second day of the signal should be a black candle opening above the high of the previous day and closing more than half way into the body of the previous day’s white candle.

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The Morning Star signal is found at the bottom of a downtrend. Like the morning star Mercury, which foretells of good things (morning) to come, this signal too suggests that good things (higher stock prices) could be on the way. Criteria:
1. The stock must have been in a definite downtrend before this signal occurs. This can be visually seen on the chart.
2. The first day of the signal must be a long dark body. The second day must be a day of indecision. The third day should be a long white candle reaching at least halfway into the body of the first day’s dark candle.

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