HOW TO READ THE CHANDLESTIK CHART - IQ OPTION STRATEGY

Here's how to read candlestick charts:

In psychology, candles are formed because of the sales pressure and the impulse to buy. The difference in the amount of pressure and encouragement is what causes candlesticks to be different from each other.

Chronology of candlestick formation:

- When there are many buyers who make purchases, the market price increases so that at the end of the market period it closes above the opening price, finally the Up candle (green) is formed.

- When many traders make a sale, the market price drops further, so at the end of the period the market closure is usually below the opening price. This condition causes the candle to form red (down).

To determine the direction of the next candle, there are several things that must be considered.

1. Resistance

2. Slow down rate

3. Flip direction

4. Convergent

1. Resistance

The form of resistance is shown by the tail of the candle. When resistance is greater than dominance, then the party that is the resistance is the one who wins and there will be a change in market dominance, so the trend will reverse direction.

2. Slowdown Candlestick

Trader's doubts to open a position cause the market to slow down. This doubt arises because traders judge the market is too high, too low, saturated conditions or the market is in a zone of support & resistance. With no traders opening positions, there is no energy to move the market.

In this condition we must be ready to open a reverse position, because the market will be taken over by one of the parties.

3. Candlestick experiment reverse direction

In a saturated market position there will be parties who try to end the trend that is happening, who want to reverse the direction of a trend. But sometimes the business begins with a test condition, which tests whether the market can be reversed or not. This is marked by a long candle tail that is opposite to the direction of the trend that is happening.

The existence of a back trial of this direction indicates that there will be a reverse direction. So that in this condition we can be prepared to open positions against the trend.

4. Convergent candlestick

Convergent conditions of this candle can also occur because there are certain parties who want to get the best price, even though they already know the market will reverse direction, but still pulling it higher or lower first to get a better price, then the market is reversed point.

In conditions like this, we see the indicator, if the indicator states convergence too, then we can open a position that is opposite to the trend that occurs.