Guide to Day Trading Strategies

Image of a Doji Candlestick.
Doji Candlesticks
A doji candlestick has a very small candle body, meaning the open price and the close price are 
nearly the same. We can infer from this candlestick shape that there is a momentary standoff 
between buyers and sellers. If the candle occurs on heavy volume it tells us there is a battle at 
that price. Sometimes a doji will also have a long upper or lower candle wick. This tells us the price 
suddenly moved up or down, but quickly returned to the same price as the open. The means 
the move was not sustained. In general, doji candles represent some degree of indecision in the 
market. When a doji candle occurs at the top of a very strong move of 5-10 green candles, the 
indecision re
Á
ected in the candle shape can signify a potential reversal. Doji’s that occur during a 
period of sideways consolidation are less important to us because sideways price action already 
re
Á
ects indecision.

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H O W T O D A Y T R A D E
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Image of a Topping Tail candle. Bottoming Tails are the inverse candle in a downtrend.
Bottoming Tails and Topping Tails
Candles at the top or bottom of a long trend that have long upper or long lower wicks are 
considered topping tail or bottoming tail candles. They can signify a potential reversal. The 
shape of the candle indicates a continuation of the trend, followed by a quick reversal with a 
close around the middle or low of the candle’s range. A doji candle that has long upper or lower 
wicks is one of my favorite indicators of a potential reversal. I rely on these candlestick patterns 
for timing my counter trend entries.

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R O S S C A M E R O N
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Image of Hammer Candle (inverted hammers occur