Japanese Candlestick Scanner Candlestick - Strategies G… · 3. The candle should have a long shadow that is at least twice the length of the body. 4. The candle has no (or almost

Japanese Candlestick Scanner &

Strategies Guide

Table of Contents

“Scanfin_Scanners” EA Disclaimer 3

Risk Warnings 4

Introduction 4

Installation 4

User Guide and Parameters info of Scanners 5

How to read the guide? 7

The complete information on each pattern and strategy 7

Bullish Hammer / Shooting star 7

Inverted Hammer / Hanging man 10

Bullish engulfing / Bearish engulfing 12

Morning Star / evening star 14

Three inside up / Three inside down 16

Tweezer Bottom / Tweezer Top 18

How to trade with every patterns? 20

Summary 22

ScanFin_Scanners#_

3 ScanFin – Yours Eye in the Capital Market

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Although every attempt has been made to ensure accuracy, we do not give any express or implied

warranty as to its accuracy. We do not accept any liability for error or omission. Examples are provided

for illustrative and educational purposes only and should not be construed as investment advice or

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There are numerous factors related to the market in general and to the implementation of any specific

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Foreign exchange trading carries a high level of risk that may not be suitable for all investors. Leverage

creates additional risk and loss exposure. Before you decide to trade foreign exchange, carefully

consider your investment objectives, experience level, and risk tolerance. You could lose some or all

of your initial investment; do not invest money that you cannot afford to lose. Educate yourself on the

risks associated with foreign exchange trading, and seek advice from an independent financial or tax

advisor if you have any questions.

Don’t trade money you can’t afford to lose.

The past performance of any trading system methodology is not necessarily indicative of future

results.

Hello,

The following guide teaches us about each of the strategies that are available to use by our scanners.

We explain each pattern and strategy in the following ways:

1. The rules of the pattern.

2. What is the interpretation of the pattern.

3. The settings we use in our system and how you can change them.

4. How we trade, based on an alert receieved from the pattern formation. (according to our opinion only

- this is not a recommendation for a trading method)

We recommend using the advanced (paid) scanners of ScanFin,

to explore the statistics of each pattern using the MetaTrader BackTesting System

And then build your own trading methods based on the patterns that the system scans and alerts.

Click here and get your ScanFin Scanner Robots now

For Install the robot on yours MT4 please read- "Robot Installation Guide" Attached the zip file.


http://bit.ly/2AJOxwP



For learn about all parameters of the ScanFin Scanners robot please read- "User Guide" Attached

the zip file.

A candlestick is a type of price chart that displays the high, low, open and closing prices of a

security for a specific period. It originated from Japanese rice merchants and traders to track

market prices and daily momentum hundreds of years before becoming popularized in the United

States. The wide part of the candlestick is called the "real body" and tells investors whether the

closing price was higher or lower than the opening price (black/red if the stock closed lower,

white/green if the stock closed higher).

Read more about what is Japanese Candlestick in Wikipedia:

https://en.wikipedia.org/wiki/Candlestick_chart


https://en.wikipedia.org/wiki/Candlestick_chart



During the guide you will see several times under "our formula" the following abbreviations - below

is an explanation of each abbreviation in relation to the full concept.

CH(X) => Candle High (X = candle number)

CC(X) => Candle Close ( X = 1 mean Last Close Candle )

CO(X) => Candle Open (X = 1)

CL(X) => Candle Low (1)

Candle 0 is the candle that open until the bar is close.

Candle 1 is the candle first candle close (from right to left).

Candle 2 is the second candle from the open candle.

3 2 1 0




For each pattern and pattern in our systems - even if you follow us for free at Telegram - or purchased one of our licenses to the system - we provide the following details:

1. How it looks 2. Explanation of the pattern 3. The pattern criteria 4. Illustrating of some situations 5. The formula and parameters of the pattern in the scanner itself

Bullish Hammer Shooting Star

Pattern explanation The Bullish Hammer pattern appears at the bottom of a downtrend and signals a market reversal from bearish to bullish (or from short to long). The Shooting Star pattern appears at the end of an uptrend and signals the market reversal from bullish to bearish (or from long to short).

The pattern consists of a single candle with a small body and a long lower shadow.




Criteria for both patterns 1. The market is characterized by a continuous downtrend at Bullish Hammer or a

continuous uptrend at Shooting Star. 2. A small candle appears, which can be green or red as shown in the picture. 3. The candle should have a long shadow that is at least twice the length of the body. 4. The candle has no (or almost no) upper shadow in the long or lower in the short An important point

• Although the color of the candle has no meaning in the pattern, the pattern is stronger if the candle appears green for long or red for short.

• The pattern is stronger if you wait for a confirmation candle – for long additional green candle that closes high above the pattern’s candle. Images to illustrate the pattern

Parameters Initial settings (full explanation about all the parameters is in the User Guide that Attached the zip file). BH_MinDownNandle = 2 (Down Needle) BH_MaxUpNandle= 0.5 (Up Needle) Our formula for Bullish Hammer (Long Example): Step 1 – Identify the trend. if CL(1) < CL(2) if CL(2) < CL(3) if CL(1) < CL(3)




Step 2 - Check the pattern of the last candle that will be in the shape and size we decide. upNandle = CH(1) - CC(1) Base CC(1) - CO(1) downNandle = CO(1)- CL(1) if( (downNandle > BH_MinDownNandle *Base) && (upNandle< BH_MaxUpNandle * Base )) Explanation - We want the lower shadow (at long) to be two times larger than the base of the candle. And we want the upper shadow (at long) to be smaller than half of the candle base. At short everything is the opposite.

Then

The Scanner send you Alert or/and Open Order




Inverted Hammer Hanging Man

Pattern explanation

The "Inverted Hammer" pattern appears at the bottom of a downtrend and signals a market

reversal from bearish to bullish (or from short to long). The "Hanging Man" pattern appears at the end of an uptrend and signals the market reversal from bullish to bearish (or from long to short).

The pattern consists of a single candle with a small body and a long lower shadow.

Criteria for both patterns 1. The market is characterized by a continuous downtrend at Inverted Hammer or a

continuous uptrend at Hanging Man. 2. A small candle appears, which can be green or red as shown in the picture. 3. The candle should have a long shadow that is at least twice the length of the body. 4. The candle has no (or almost no) upper shadow in the long or lower in the short An important point

• Although the color of the candle has no meaning in the pattern, the pattern is stronger if the candle appears green for long or red for short.

• The pattern is stronger if you wait for a confirmation candle – for long additional green candle that closes high above the pattern’s candle.




Images to illustrate the pattern

Parameters Initial settings (full explanation about all the parameters is in the User Guide that Attached the zip file). HM_MinDownNandle = 2 (Down Needle) HM_MaxUpNandle = 0.5 (Up Needle) Our formula for Inverted Hammer (Long Example): Step 1 – Identify the trend. if CL(2) < CL(3) if CL(1) < CL(3) Step 2 - Check the pattern of the last candle that will be in the shape and size we decide. upNandle = CH(1) - CC(1) Base CC(1) - CO(1) downNandle = CO(1)- CL(1) if( (downNandle > BH_MinDownNandle *Base) && (upNandle< BH_MaxUpNandle * Base )) Explanation - We want the lower shadow (at long) to be two times larger than the base of the candle. And we want the upper shadow (at long) to be smaller than half of the candle base. At short everything is the opposite.

Then

The Scanner send you Alert or/and Open Order!




Bullish Engulfing Bearish Engulfing

Pattern explanation

The "Bullish Engulfing" pattern appears at the bottom of a downtrend and signals a market

reversal from bearish to bullish (or from short to long). The "Bearish Engulfing" pattern appears at the end of an uptrend and signals the market reversal from bullish to bearish (or from long to short).

The pattern consists of two candles, the last candle enveloping the first candle.

Criteria for both patterns

1. The pattern is characterized by a long green candle that swallows the red candle that appears on the previous candle, continuing the downward trend.

2. The green candle does not have to swallow the shadow of the red candle, but it must swallow the entire body. This pattern is considered an important reversal pattern.

An important point

• The ratio of the body of the candles on the first and second candle is important, if on the first

candle the body of the red candle is very small or close to Doji, but on the second candle there is

a very long green candle. This is a strong indicator that the sellers are falling and the power of the

buyers is increasing.

• The strength of the mold depends on the size of the green candle on the second candle, sometimes

the green candle can swallow more than one whole candle.





Parameters Initial settings (full explanation about all the parameters is in the User Guide that Attached the zip file). -No Input Parameters. Our formula for Bullish Engulfing (Long Example): Step 1 – Identify the trend. if CL(1) < CL(2) if CL(2) < CL(3) if CL(1) < CL(3) Step 2 - Check the pattern of the last candle that will be in the shape and size we decide. if CC(1) > CO(1) // Candle 1 = green if CC(2) < CO(2) // Candle 2 = red if CC(1) > CH(2) // Close candle 1 > High candle 2 Explanation - We want the closing of candle 1 above the high of candle 2 so that at high percentages we know that the market is going to continue to rise. The lower shadow of the two candles - The more it is big it means the market is pushed up more strongly. At short everything is the opposite.

Then





Morning Star Evening Star

Pattern explanation

The "Morning Star" pattern appears at the bottom of a downtrend and signals a market

reversal from bearish to bullish (or from short to long). The "Evening Star" pattern appears at the end of an uptrend and signals the market reversal from bullish to bearish (or from long to short). The pattern consists of three candles when the last candle closes at the top 50% of the first candle.


1. The pattern is characterized by a long green candle that closes inside the red candle

2. The green candle should be at the top 50% of the candle red number 3. An important point

• This pattern is considered to be highly reliable, but it can be further strengthened by waiting for

confirmation on the fourth candle. The confirmation may appear in the shape of a green candle,

opening at a higher point or closing at a new peak.





Parameters Initial settings (full explanation about all the parameters is in the User Guide that Attached the zip file). MS_ES_CandleOneIntoCandleThree = 0.5 (Where closed candle 1 in a candle 3 - percent) Our formula for Morning Star (Long Example): Step 1 – Identify the trend. if CL(2) < CL(3) if CL(2) < CL(4) if CL(3) < CL(4) if CL(3) < CL(5) Step 2 - Check the pattern of the last candle that will be in the shape and size we decide. if CC(1) > CO(1) // Candle 1 = green if CC(3) < CO(3) // Candle 2 = red if CC(1) < 0.5 of CO(3)-CO(3) // Close candle 1 > 50% of Open candle 3 – Close candle 3 Explanation - We want candle 1 to close at the top of the base candle 3. At short everything is the opposite.

Then





Three Inside Up Three Inside Down

Pattern explanation

The "Three Inside Up" pattern appears at the bottom of a downtrend and signals a market

reversal from bearish to bullish (or from short to long). The "Three Inside Down" pattern appears at the end of an uptrend and signals the market reversal from bullish to bearish (or from long to short).

The pattern consists of two candles, the last candle enveloping the first candle.


1. The pattern is characterized by a long green candle that swallows the red 3 candle that appears on the previous candle, continuing the downward trend.

2. The green candle does not have to swallow the shadow of the red 3 candle, but it must swallow the entire body. This pattern is considered an important reversal pattern.

An important point

• This pattern is considered to be highly reliable, but it can be further strengthened by waiting for

confirmation on the fourth candle. The confirmation may appear in the shape of a green candle,

opening at a higher point or closing at a new peak.





Parameters Initial settings (full explanation about all the parameters is in the User Guide that Attached the zip file). -No Input Parameters. Our formula for Three Inside Up (Long Example): Step 1 – Identify the trend. if CL(3) < CL(4) if CL(3) < CL(5) Step 2 - Check the pattern of the last candle that will be in the shape and size we decide. if CC(1) > CO(1) // Candle 1 = green if CC(2) > CO(2) // Candle 2 = green if CC(3) < CO(3) // Candle 3 = red if CC(1) > CH(3) // Close candle 1 > High candle 3 Explanation - We want the closing of candle 1 above the high of candle 3 so that at high percentages we know that the market is going to continue to rise. At short everything is the opposite.

Then





Tweezer Bottom Tweezer Top

Pattern explanation

The tweezer is a dual candlestick reversal pattern.

This pattern can usually be spotted after an extended uptrend or after an extended downtrend, indicating that a reversal is about to occur.

The Tweezer Top formation is viewed as a bearish reversal pattern seen at the top of uptrends and the Tweezer Bottom formation is viewed as a bullish reversal pattern seen at the bottom of downtrends.


1. The first candlestick of the Tweezer pattern is the same as the previous candlesticks of the trend. The second candlestick of the Tweezer pattern is opposite to the overall trend.

2. The 2 candlesticks should have the same low or high and their lower or upper shadows should be of an equal length.

An important point

• The Japanese candlestick pattern Tweezer is relatively rare and therefore has a higher success rate.





Parameters Initial settings (full explanation about all the parameters is in the User Guide that Attached the zip file). -No Input Parameters. Our formula for Tweezer Bottom (Long Example): Step 1 – Identify the trend. if CL(2) < CL(3 ) if CL(2) < CC(4) Step 2 - Check the pattern - If both candles have the same bottom if CC(1) > CO(1) // Candle 1 = green if CC(2) < CO(2) // Candle 2 = red

if CL(1) - CL(2) < TTB_MaxDis_PIPS // Both needles have the same bottom or difference smaller than 1 pips

Explanation - We want the closing of candle 1 = green and candle 2 = red and both candles have the same bottom At short everything is the opposite.

Then





The next ideas is relevant to every patterns.

Idea number 1

** All the patterns are like the examples. Open order– immediately (if you will come to mt4 in late – don’t open!) SL = Low of Pattern – X pips (5 pips below the low) TP = SL (same pips like the SL)

(In chart 4 hour and more I will trade TP = 2 X SL – we recommend do Back-testing and research to know exactly)

When you get Short Alert do everything in the opposite way!




Idea number 2

** All the patterns are like the examples. Open – pending order for BUY in 3 pips above the high of Pattern. SL = Low of Pattern – X pips (like 5 pips below the low) TP = SL (same pips like the SL) (In chart 4 hour and more I will trade TP = 2 X SL – we recommend do Back-testing and research to know exactly)

When you get Short Alert do everything in the opposite way!




Our system is a combination of automated trading (market scanner searching for you) and manual

trading - you make the decision to open a trade - this way has the maximum possibility to succeed in

trading in the Forex market and the Capital market.

The combination of machine and person - making decisions and trading right and relaxed - will enable

you to become a successful and profitable trader over time.

In this guide we explained what each parameter of the system is saying and used.

There is a guide that teaches you to trade with Japanese Candlestick - do not forget to go through

it and learn more!

In our opinion, all you need to do to succeed in trading with our system is the following steps:

1. Install the system.

2. Learn what each parameter says.

3. Make a Back-Testing - learn how each currency behaves with every pattern.

4. Understand which SL and TP are best for each situation and asset.

5. Turn on the system - and trade according to your research - with iron discipline!

6. Remain only to make money in an informed and relaxed manner.

We hope you have understood the principle of success.

Best of luck

ScanFin Team


Documents

Japanese Candlestick Scanner Candlestick - Strategies G… · 3. The candle should have a long shadow that is at least twice the length of the body. 4. The candle has no (or almost