The King's Trader Education

The Trading Plan
The Simpleton's Fibonacci
Fibonacci 101
Fibonacci 102
Fibonacci 103
Practiical Candlestick - Basic Patterns
Steve Nison - Interview with Father of Candlesticks
Steve Nison - Favorite Candlestick Signal
Practical Candlestick - Seedwaves
Practical Candlestick - OBV
Practical Candlestick - Harami
Pivot Points
Basics of Bollinger Bands
Distribution/Accumulation Zones
Donchian Channels
Elliott Waves
Market Structures
Multiple Moving Averages - "The Rope"
Three Price Break
Elements of Gann Angles
Gann Percentage Pivots
Gann on 1929
Options - Basics
Options - Indexes and ETFs
Options - Greek
Options - Covered Calls
Options - Spreads
Options - Straddle
Options - Strangle
Options - Calendar Spreads & Options Repair Strategy
Sector Trading
Swing Trading
Position Trading
TICK & TRIN Tutorial
TICK & TRIN - Sustained Reversal

Trader Training - Free Educational Trading Articles:

Practical Candlestick - Harami

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My absolute favorite thing about Japanese Charting techniques is the names they associate with the candles and candle patterns. In this case, the Harami Brake means just what it sounds like. It applies a “brake” to the downtrend. When this happens, the trend will come to a halt, the market might lull for a bit, and then reverse. This example comes from a weekly chart. As you can see, after the harami forms, the next week’s candle really doesn’t trade outside the pattern. One candle on the weekly represented five trading sessions, which basically traded sideways. Then, after those, you see the move “up”.

Here is another example of the same type of pattern, but the brake is applied to the uptrend:

In this 13 minute chart of MSFT, notice how after the brake is applied to the uptrend, it trades absolutely sideways for almost a dozen sessions and then the bottom falls out!

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"It takes a man a long time to learn all the lessons of all of his mistakes. They say there are two sides to everything. But there is only one side to the stock market; and it is not the bull side or the bear side, but the right side. It took me longer to get that general principle fixed firmly in my mind than it did most of the more technical phases of the game of stock speculation" ----from REMINISCENCES OF A STOCK OPERATOR