Market Sentiment Analysis of Candlestick Charts

Author: Duane M. Tilden, P.Eng.                       Date: June 23, 2018

To become a successful trader in markets, such as cryptocurrency trading, one has to develop strategies which will give them the greatest probability of success, or for most, a profit.

How much risk and reward is up to every trader, as well as the selection of digital assets held and quantity. There are short, medium and long term goals and various methods of achieving each one of these objectives.

One tool that is very useful for developing short term trading strategies which can return a profit to the trader, is understanding Candlestick charts.

Figure 1: Anatomy of a Candlestick (1)

Anatomy of a candlestick

For reading and developing trading strategies, understanding the mechanics of a candlestick chart can lead to opportunities in trading assets to maximize ROI (return on investment), or to determine when to buy and sell assets.

How to Read a Single Candlestick (2)

Each candlestick represents one day’s worth of price data about a stock through four pieces of information: the opening price, the closing price, the high price, and the low price. The color of the central rectangle (called the real body) tells investors whether the opening price or the closing price was higher. A black or filled candlestick means the closing price for the period was less than the opening price; hence, it is bearish and indicates selling pressure. Meanwhile, a white or hollow candlestick means that the closing price was greater than the opening price. This is bullish and shows buying pressure. The lines at both ends of a candlestick are called shadows, and they show the entire range of price action for the day, from low to high. The upper shadow shows the stock’s highest price for the day and the lower shadow shows the lowest price for the day.

Bearish and Bullish Candlesticks

A candlestick represents the price activity of an asset during a specified timeframe through the use of four main components: the open, close, high and low.

The “open” of a candlestick represents the price of an asset when the trading period begins whereas the “close” represents the price when the period has concluded. The “high” and the “low” represent the highest and lowest prices achieved during the same trading session.

There is much more to reading and understanding candlestick charts than is covered here. This brief has informational links to where more information on patterns and indicators, and advice on how to use these patterns to make decisions in trading.

Bottom Line (2):

Investors should use candlestick charts like any other technical analysis tool (i.e., to study the psychology of market participants in the context of stock trading). They provide an extra layer of analysis on top of the fundamental analysis that forms the basis for trading decisions. We looked at five of the more popular candlestick chart patterns that signal buying opportunities. They can help identify a change in trader sentiment where buyer pressure overcomes seller pressure. Such a downtrend reversal can be accompanied by a potential for long gains. That said, the patterns themselves do not guarantee that the trend will reverse. Investors should always confirm reversal by the subsequent price action before initiating a trade. (Read more in Candlestick Charting: Perfecting The Art)

References:

  1. crypto-trading-101-beginners-guide-candlesticks/
  2. using-bullish-candlestick-patterns-buy-stocks
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Energy Storage Compared to Conventional Resources Using LCOE Analysis

In its first analysis of the levelized cost of storage, Lazard finds some promising economic trends.

Sourced through Scoop.it from: www.greentechmedia.com

“[…] “Although in its formative stages, the energy storage industry appears to be at an inflection point, much like that experienced by the renewable energy industry around the time we created the LCOE study eight years ago,” said George Bilicic, the head of Lazard’s energy and infrastructure group, in a release about the report.

Lazard modeled a bunch of different use cases for storage in front of the meter (replacing peaker plants, grid balancing, and equipment upgrade deferrals) and behind the meter (demand charge reduction, microgrid support, solar integration). It also modeled eight different technologies, ranging from compressed-air energy storage to lithium-ion batteries.

“As a first iteration, Lazard has captured the complexity of valuating storage costs pretty well. Unlike with solar or other generation technologies, storage cost analysis needs to account for not just different technologies, but also location and application, essentially creating a three-dimensional grid,” said Ravi Manghani, GTM Research’s senior storage analyst.

In select cases, assuming best-case capital costs and performance, a handful of storage technologies rival conventional alternatives on an unsubsidized basis in front of the meter. Using lithium-ion batteries for frequency regulation is one example. Deploying pumped hydro to integrate renewables into the transmission system is another.  […]

See on Scoop.itGreen Energy Technologies & Development

The Precautionary Principle | Canadian Environmental Law Association

The precautionary principle denotes a duty to prevent harm, when it is within our power to do so, even when all the evidence is not in. This principle has been codified in several international treaties to which Canada is a signatory. Domestic law makes reference to this principle but implementation remains limited.

Source: www.cela.ca

See on Scoop.itGreen & Sustainable News

Virtual Energy Audits: The Next Big Thing in Buildings?

See on Scoop.itGreen Building Operations – Systems & Controls, Maintenance & Commissioning

Virtual energy audits use software to collect meter data, weather information, etc. and algorithms to develop energy efficiency recommendations.

Duane Tilden‘s insight:

>The goal of any energy audit is to identify savings by analyzing data, determining how and where a building is using energy, and then providing operational and capital energy efficiency measures that improve overall performance.

A traditional ASHRAE Level II Audit includes a manual inspection of data related to a facility’s Building Envelope, Lighting, Heating, Ventilation, and Air Conditioning (HVAC), Domestic Hot Water (DHW), Plug Loads, and Compressed Air and Process Uses (for manufacturing, service, or processing facilities). Analysis is conducted to quantify baseloads and account for seasonal variation. A Level II Audit will also include an evaluation of lighting, air quality, temperature, ventilation, humidity, and other conditions that may affect energy performance and occupant comfort. The process also includes detailed discussions with the building owners, managers, and tenants – there is a lot you can learn just by talking to people about what they think is working and not, what the financial objectives of the organization are, and how that should feed into the recommendations.  […]

Ok, I get it: So what’s a virtual energy audit?

Essentially a virtual energy audit is much like a traditional audit: the goal is to synthesize a whole bunch of data and come up with a list of recommendations that are going to deliver you the biggest bang for your buck. Unlike a detailed ASHRAE Level II audit, it’s better to think of virtual audits as delivering against the 80/20 rule. For a lot less physical effort, it’s going to get you about 80% of the detailed insights that a traditional ASHRAE Level II energy audit would deliver. And for many organizations, that’s OK – because their biggest, most obvious energy hogs are the ones driving the biggest bills at the end of the month.<

See on energysmart.enernoc.com

Reshaping Corporations: Can Divestment Work?

See on Scoop.itGreen & Sustainable News

With enough collective action, mass divestment campaigns can be effective in creating social change. 

Duane Tilden‘s insight:

>To be effective, a huge amount of money must be withdrawn from a company. Where boycotting unites individual buyers to have impact, individual stockowners aren’t likely to make a huge enough hit with divestment or negative investing for a corporation to take notice. Institutional owners, though, could impact a company or industry because collectively they control vast amounts. 

The Fossil Fuel Divestment Campaign

The current student campaign to divest from fossil fuels is interesting. For example, Harvard has $30 billion in endowment while Yale has $16.7 billion.

While it’s clearly not all in one company or industry, what kind of impact could university endowments have if they withdrew from fossil fuel companies and allied industries? By my count, there are well over a hundred campaigns at universities around the nation, and there are additional groups working to get towns and communities to join the fight. As a collective action, the potential for these divestment campaigns is fascinating to ponder.

Mass Divestment Creates Cultural Change

Perhaps the most important thing divestment shares with boycotting is publicity.  The attention that a mass divestment can bring to an issue could be profound. The student fossil fuels divestment effort is garnering national media attention, and rather than fizzling out seems to be gaining momentum. This attention could be as effective as actual divestment for dealing with climate change and fossil fuel issues. 

As Cecelie Counts wrote in January, divestment was just one tool used to combat apartheid and bring change in South Africa. I don’t know if there will be mass divestment among universities, but I suspect that this campaign will be successful in the long run because it’s educating a generation and could create the cultural change necessary to pursue long-term alternatives, change policy and pressure energy companies to adapt.<

See on csrwire.sharedby.co

Applied Thermodynamics: Organic Rankine cycle – Wikipedia

See on Scoop.itGreen Energy Technologies & Development

Duane Tilden‘s insight:

We have all seen the Rankine Cycle engine, most typically as the inefficient steam locomotive.  The modern efficient designs use turbines to convert heat energy from two reservoirs of different temperatures to mechanical energy.

The Organic Rankine Cycle engine uses a fluid – vapor phase change other than water/steam and a wide range of compounds are available including proprietory mixtures.  These mixtures allow for the conversion to mechanical energy in a wide range of applications and temperatures.  Two such applications would be waste heat to energy and geothermal energy systems.

See on en.wikipedia.org