The Myth of Gap in Candlestick Patterns (99% of Traders Don't Know!)

Hey. I hope your last week is concluded with a decent profit. 

No worries if it's not because I'll help you. Your hatred on me doesn't matter, I'm going to help you anyway. 

Before we begin, let me ask you a question:

How many of the Japanese Candlestick Patterns (JCP) I introduced have at least one gap in their formation? 

Give me the answer real quick! 

Eight. They are Bullish Engulfing, Bearish Engulfing, Piercing, Dark Cloud Cover, Three White Soldiers, Three Black Crows, Morning Star and Evening Star. 

More often than not, you can't recognize these eight JCP as easy as the Hammer and Shooting Star. Why? The gap. 

No, the problem is not the gap. Instead, the problem is absence of the gap. 

What do I mean by that? Let's flash back to the conventional formation of the eight JCP: 

Did you see the gaps? No? A gap is simply the empty space between the closing price of the previous candle and opening price of the next candle. 

Listen. If the JCP on the live chart is formed exactly the same as illustrated, it is doubtlessly a five-star JCP that carries very strong predictive power. In real life, however, it is often not the case. 

Have you been to McDonald's? While those burgers painted on the menu look huge, juicy and mouth-watering, how does the actual burgers you get look like? You can't blame the McDonald's, kiddo. There's a line saying:

Product images are for illustration purposes only. Actual products may vary. 

Now you get it! I love this beautiful line. It applies in trading too. 

What will the eight JCP look like if the gaps do not exist? Let's take a close look: 

Are they still a valid JCP? Definitely. Are they tradable? Of course. Even in the absence of the gap. 

"On what occasion the gap is absent?" You probably ask. 

This time, I'm not going to spoon feed you. Go find the answer yourself and tell me loudly and proudly.

Now, I want you to remember this: 

JCP images are for illustration purposes only. Actual patterns may vary. However, you can always identify one based on the psychology of the pattern which forever remains unchanged.

---Become a Profitable Trader---

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