How to Master the Heiken Ashi Trading Technique with this Free Ebook
If you are looking for a simple and effective way to identify market trends and trade with confidence, you might want to check out the Heiken Ashi trading technique. This is a Japanese charting method that uses modified candlesticks to filter out market noise and highlight the direction and strength of price movements.
In this article, we will explain what Heiken Ashi is, how it differs from traditional candlestick charts, and how you can use it to spot trading opportunities. We will also share with you a link to download a free ebook that will teach you everything you need to know about this powerful trading technique.
What is Heiken Ashi
Heiken Ashi means \"average bar\" in Japanese. It is a charting technique that uses a special formula to calculate the open, high, low, and close prices of each candlestick. Unlike regular candlesticks, which show the actual prices of each time period, Heiken Ashi candles show the average prices of the current and previous periods.
This means that Heiken Ashi candles smooth out the price fluctuations and make it easier to see the dominant trend. They also have different colors depending on whether the average price is rising or falling. Green candles indicate an uptrend, while red candles indicate a downtrend.
How does Heiken Ashi differ from traditional candlestick charts
There are several differences between Heiken Ashi and traditional candlestick charts. Here are some of them:
Heiken Ashi candles open from the midpoint of the previous candle, while traditional candles open from the close of the previous candle.
Heiken Ashi candles close at the average of the open, high, low, and close prices of the current period, while traditional candles close at the actual price of the current period.
Heiken Ashi candles have smaller shadows (wicks) than traditional candles, as they only show the maximum and minimum prices reached within the average range of the current period.
Heiken Ashi candles tend to have more consecutive candles of the same color than traditional candles, as they reflect the average direction of the price movement.
How to use Heiken Ashi to identify trends and trade signals
One of the main advantages of using Heiken Ashi is that it can help you identify trends and trend reversals more easily than traditional candlestick charts. Here are some tips on how to use Heiken Ashi for trend analysis:
Look for long and solid candles of the same color to confirm a strong trend. The longer and more solid the candles are, the stronger the trend is.
Look for small and hollow candles of different colors to indicate a weak or sideways trend. The smaller and more hollow the candles are, the weaker or more indecisive the trend is.
Look for changes in color or size of the candles to signal a possible trend reversal. A change in color means that the average price direction has changed, while a change in size means that the price volatility has increased or decreased.
Look for patterns such as doji (cross-shaped candles), hammer (candles with long lower shadows), or engulfing (candles that cover the previous candle) to confirm a trend reversal. These patterns show that there is a shift in market sentiment from bullish to bearish or vice versa.
How to download a free ebook on Heiken Ashi trading technique
If you want to learn more about Heiken Ashi trading technique and how to apply it to various markets and time frames, we have good news for you. You can download a free ebook that will teach you everything you need to know about this powerful trading technique.
The ebook is called \"Heikin-Ashi: How to Trade without Candlestick Patterns\" by Dan Valcu. It is a comprehensive guide that covers topics such as:
The history and philosophy of Heikin-Ashi
The calculation and interpretation of Heikin-Ashi candles