The Doji Candlestick
Futures and Forex Trading System . Swing Trading
The doji candlestick can help you to determine the direction of a given market. It can be a good indicator that a trend is starting to weaken and may be getting ready to reverse.
What this candlestick actually is is a point where neither the bulls nor the bears are able to take control of a given stock. It shows indecision of a security which is why it can be used as a reversal signal at the end of a trend. If there is indecision in a bull trend obviously the bulls are losing power vice versa.
There are four different types of dojis. Each can mean a completely different thing.
1. The regular doji is the pattern in its basic form. Here the stock opened and really did not do anything. It may have gone up and down throughout the day but overall it was pretty much flat.
This can show a possible reversal, but be careful it can also be a pull back.
2. The long end doji is very similar to a regular doji. The only difference is that the candlestick had a much higher trading range for the day. It can have the same meaning as the doji.
3. The dragonfly doji can be a possible bullish reversal if it occurs when prices have token a small hit. This is when the security opened and was pushed down. But by the end of the day the bulls came and pushed it back up. This can show that the bulls are starting to gain strength and the bears are starting to lose it.
4. The graveyard doji is exactly opposite. It can spot the top of a small rally. In this pattern the price opened and the bulls pushed it higher. By the end of the day the bears came in and pushed it back down causing it to be flat. This shows the stock might be losing its upward pressure.

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