Timing Solutions for Swing Traders: A Novel Approach to Successful Trading Using Technical Analysis and Financial Astrology

CLOSE

The close is the price transacted at the end of a trading day or of a trading period. This is the most watched and most frequently quoted market-generated price information. Most of the trading strategies, indicators, and oscillators are based on using the day’s close as the key component. The close is often seen as the result of the struggle between the bulls and the bears. If the close is at or near the high of the day and the opening was near the low, evidently buying power was more powerful. If selling pressure was greater than buying power, then it would have caused the market to close down from the high. If the close is at or near the low of the day and the opening was near the high, then the selling pressure was dominant for the day. If the close is halfway between the high and the low, irrespective of the opening, then it may be assumed that the market is evenly divided between buying power and selling power. It is common, as the market enters a rally stage, that the close tends to be near the high of the period, with the open near the low.

A doji is a sign of a probable change in market direction and it should be read in combination with additional candlesticks. See Figure 3.3. It is not a stand-alone signal. A gravestone doji is formed when both the open and the close meet at the low of the day’s range; it gives a bearish signal when it is found at the top of an uptrend. Its counterpart is the dragonfly, which is the reverse pattern of a gravestone doji. In a dragonfly, ...