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Marubozu candlestick trading - best Japanese candlestick patterns - YouTube
Channel: The Diary of a Trader
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hello traders welcome back thank you for聽
joining us again today and in this lesson聽聽
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we're going to cover the maribozu candle stick聽聽
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and how to use it as a strong price聽
action confirmation in your trade setups
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so this is what we'll cover how to use the candles聽
what it is how to trade with it and we'll go over聽聽
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a couple of examples so you can understand聽
what it is so let us just go through what聽聽
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maribozu candle represents so first of all聽
marabo just means shaven head in japanese聽聽
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and what that means is that there聽
is no wick on the candle so usually聽聽
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candle would have a wick to the upside or聽
downside but in this case there is no wick聽聽
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and what's happening inside this candle is that we聽
take for example this bullish candle which opened聽聽
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here and closed here so before the scandal聽
we would have had perhaps another candle and聽聽
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where the price closed here it then opened here聽
and just went straight up so if you look at the
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price activity within this we just have buying聽
buying buying buying right to the top and the聽聽
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price closes so this is a very strong indication聽
of buying it's a bullish confirmation and it shows聽聽
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that there are many buyers and there is a lot聽
of buying momentum in the market and the same聽聽
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goes the other way around here we would have if聽
we just ignore this for a moment we would have
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perhaps a candle from price section moving聽
here and then again the price closed here聽聽
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on the previous candle it then opens聽
at the same place and it goes straight聽聽
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down and we have a lot of selling pressure聽
this is a clear indication that the market聽聽
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really wants to continue on its聽
way and push towards the downside
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now there is a slight variation on it you do聽
sometimes get on a bullish one you might have聽聽
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a little wick like this on the bearish聽
one you might also have a little wick聽聽
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below we might also have a little聽
wick above on one of the sides聽聽
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and also be here small one but either way聽
don't get hung up over the wick and how long聽聽
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it is just as long as it's a small wick and聽
this is clearly price clearly starts at one
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place and moves straight into another so we have聽
the difference here is clearly very pronounced聽聽
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and these candles indicate a particular direction聽
in the market now let's go over to the chart and聽聽
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look at how these candles form on the chart聽
and how to actually trade them in your setups聽聽
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right so here we have the pound yen chart聽
on the daily so each candle represents a day聽聽
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and the first way to use the maribor's candle聽
is as a confirmation for your swing trade聽聽
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so when you see the candle during a trend when聽
you are catching swings in the train in the trend聽聽
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then you can look for the marabosa to confirm that聽
direction so again we have a trend that we talked聽聽
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about before and what you will see that when you聽
are looking for confirmation in this area for聽聽
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the next swing to start its downward move we can聽
look for the price section of the marabozu here
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to confirm that we are now going down so let's聽
look at that here in an example we have clear聽聽
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trend with the swings and now we have some聽
interesting price action here and what you聽聽
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will see is you can see this marabou candle here聽
if we just zoom in you could see that there is聽聽
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hardly any wick on either side and you and then聽
this will be a confirmation for us with the stop聽聽
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loss and take profit below and we can see that聽
after that the market continues trending and you聽聽
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can actually see again once again we have the next聽
swing point here if we just pay attention to this聽聽
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we have another swing and yet again the market聽
moves off aggressively and here is our marabou聽聽
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the candle as you can see very little wick聽
here almost practically no week at the top聽聽
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and that is the candle here and here聽
is our trade the stop-loss and entry
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at the same time we can have there's聽
another example here although the market聽聽
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was ranging and we can see that often what聽
the market will do in terms of price action
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let's just remove all these objects and we can聽
see what the market will often do is during its聽聽
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movement its continuation we could see a lot of聽
weak candles and there's one mara buzzer here聽聽
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but if you do not enter there we can see聽
that along the way we have more candles聽聽
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warmer buzzer candles like this for example聽
confirming that the market is continuing聽聽
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to the downside continuing on its trend the second聽
method to use the marabazu would be a reversal聽聽
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so for example if you spotted a reversal聽
area that you want to take the trade off聽聽
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in this case we have the market moving up and聽
we have this reversal zone here where the mark聽聽
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is at market has been before and if you see聽
the price action the mariboza price section聽聽
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at the level then you will want to consider a聽
trade once you have that confirmation of the聽聽
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selling pressure in this case because we're聽
looking for a cell here we have at this聽聽
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level what looks like a maribozu however聽
we can see that there is a little wick聽聽
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up there and there's a wick below so it's not the聽
cleanest we may want to wait for a further swing
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and enter
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somewhere like this and that will give聽
us more confirmation so let's wait for聽聽
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a little bit more and we can see here聽
clear mariboza candle and clearly
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we can put our entry stop聽
loss and take profit points聽聽
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and this is a very strong confirmation聽
as you can see no wick at the top at the聽聽
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head and then we have a little wick at the聽
tail and that is clearly a marabous a candle
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and the market moves off that聽
is the method for reversal聽聽
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and finally for the last note just remember as聽
with all the other candlestick patterns and the聽聽
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other types of setups you do not want to trade聽
the maribors on its own just for these reasons聽聽
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you do want to have confluences and聽
you do want to have other factors in聽聽
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your setup to strengthen it to improve to聽
increase the probability of it working out聽聽
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so in this case if we just for a moment聽
go back here what we can see is we've had聽聽
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on the lower time frame we've had聽
swings we've had the market trending聽聽
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then you may want to look at your zones聽
you may want to look at your trend lines
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and you may want to place fibonacci聽
and use all those combinations聽聽
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to improve the probability and then once you've聽
got that confirmation we can see if we just聽聽
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go back to the daily very strong confirmation聽
that the market is continuing to the downside
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right so thank you for watching and聽
just look out for the marabosa candles聽聽
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they're very strong in terms of price action and聽
clear and you can use them as entry confirmation聽聽
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when you're thinking about entering聽
a trade when you've identified聽聽
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a trade setup with all of your other factors and聽
rules and confluences so good luck in your trading
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