Topic 12: HEIKIN ASHI: mrtq13

Heikin Ashi is an averaged candlestick chart. The high,low,open,close of normal candlestick is averaged in Heikin Ashi chart. But why! There is a problem with candlestick-the problem with feeling smoothed. Look at the chart of normal candlestick and Heikin Ashi charts. You will see whereas Trend,support,resistance are clear in Heikin Ashi,you will have hard time to understand those in normal candle charts..........
Besides Heikin Ashi has a trend showing feature,which normal candle doesn't.......I have one modified Heikin Ashi chart which changes its color when trend change.All you have to do is to enter when the color is green,and exit when the color is red. Easy.......Normal candle has small sentiment or trend showing capability.Not long.........Look at a candle chart,you will see a lot of red candles,which will tell you to get out of a trade early.But you will find that it was not an exit,as that stock later went up.So,you fell into whipsaws........
To get rid of this kind of whipsaws,Heikin ashi was created,and also has been created the Trailing Stop method......When combined,these two can keep you into a trade very very long time without getting you shaken out...........Remember to stay alive in the market,and to really get profit,you will have to hold on to a stock as long as it is in uptrend.............
I keep all type of charts in my soft. But I have different strategy for different situation in DSE. For example,I know that when there is compression pattern in Heikin Ashi chart,trend is going to change. This compression pattern was used to trade both Goldenson and 1stNRB and were profitable.........
However,you can't interpret the candles of Heikin Ashi as normal candles.There is hardly any evening star candlestick formation in Heikin Ashi candle.But we actually don't need that too......The more experienced you get on Candlestick technique,the more skill you will be to quickly understand what is going on........Anyway,for that you need to practise.And using Bar Replay,you can practise and learn...........