Below is the chart for USD/JPY.
On the 20th October 2014 the price action on the Yen was the definition of the Hammer shape after several sessions of declination. within context of the previous 3 months the USD had steadily been on the rise against the Japanese Yen. However markets do not appreciate or decline in continuous motion as opposing forces always need to pause when a market runs out of news data, fundamentals and technical indicators. Markets are always in a tussle between opposing forces hence our expression of a battlefield.
On this day the USD base currency versus the Yen formed the following data -
open 106.9100
close 106.9100
high 106.9100
low 106.2700
This is the classic expression of the Hammer in candlestick charting where the open and close and high all form at the top end with a lower tail. the market has indeed hammered out a bottom.
after several sessions of indecision and sideways trading channel the market takes off in a positive direction after the hammer indicates a refusal for the price action to sink any further.
Further reading -
- The Shooting Star - http://forexeducationperspective.blogspot.com/2015/01/article-markets-and-battlefields-4a.html
- The Hammer - http://forexeducationperspective.blogspot.com/2015/02/article-markets-and-battlefields-3b.html
- The Hammer - http://forexeducationperspective.blogspot.com/2015/01/article-markets-and-battlefields-3a.html
- The Hanging Man - http://forexeducationperspective.blogspot.com/2015/01/article-markets-and-battlefields-2c.html
- The Hanging Man - http://forexeducationperspective.blogspot.com/2015/01/article-markets-and-battlefields-2b.html
- The Hanging Man - http://forexeducationperspective.blogspot.com/2014/12/article-markets-and-battlefields-2.html
Pieter Bergli - DeLoren Trust Holdings
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