What is a marubuzu?
In this article you would find what to do after a marubozu.
Key takeaways:
ü Remember the rules based on which candlesticks work
ü Marubozu is the only pattern which violates rule number 3 i.e
Look for prior trend
ü A bullish marubozu indicates bullishness
o Buy around the closing price of a bullish marubozu
o Keep the low of the marubozu as the stoploss
ü A bearish marubozu indicates bearishness
o Sell around the closing price of a bearish marubozu
o Keep the high of the marubozu as the stoploss
ü An aggressive trader can place the trade on the same day as the
pattern forms
ü Risk averse traders can place the trade on the next day after
ensuring that it obeys rule number 1 i.e Buy strength, and Sell weakness
ü An abnormal candle lengths should not be traded
o Short candle indicates subdued activity
o Long candle indicates extreme activity, however placing stoploss
becomes an issue.
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