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High Wave Candle Pattern
The high wave candlestick reminds me of the long legged doji candlestick only the high wave is not a doji. Both have tall upper and lower shadows. The high wave candle can be any color, but the long legged doji has no body so it has no color.
High Wave Candlestick: Important Results
Theoretical performance: Indecision Tested performance: Reversal 51% of the time Frequency rank: 17 Overall performance rank: 67 Best percentage meeting price target: 77% (bull market, up breakout) Best average move in 10 days: -3.38% (bear market, down breakout) Best 10-day performance rank: 60 (bear market, up breakout) All ranks are out of 103 candlestick patterns with the top performer ranking 1. “Best” means the highest rated of the four combinations of bull/bear market, up/down breakouts. The above numbers are based on hundreds of perfect trades. See the glossary for definitions. |  High Wave |
High Wave Candlestick: Discussion
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Testing the high wave candle shows that it acts as a reversal 51% of the time, which is about random, and that agrees with theory (indecision). The high wave candle appears often, giving it a frequency rank of 17 (a rank of 1 means most often, 103 means almost invisible).
High Wave Candlestick: Identification Guidelines
High Wave Candlestick: Three Trading Tidbits
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High Wave Candlestick: Example
The high wave candlestick shown on the daily chart at point A appears in an uptrend. For that reason, I would expect the breakout to be upward and that is what happens (a breakout is when price closes either above the top or below the bottom of the candlestick).
The high wave candle has tall upper and lower shadows with a non-doji body. That means the opening and closing prices are far enough apart to show a body color.
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