The Candlestick Course by Steve Nison Summary

The Candlestick Course is a comprehensive guide to mastering Japanese candlestick charting, a technical analysis method for financial markets. It teaches traders to interpret price action through candlestick patterns like Doji, Spinning Tops, and Long Real Bodies, offering strategies for identifying trend reversals, continuations, and optimal entry/exit points. The book includes quizzes, real-world examples, and practical exercises to reinforce learning.

This book is ideal for traders and investors at all levels seeking to enhance their technical analysis skills. Beginners gain a structured introduction to candlestick basics, while advanced traders learn to refine existing strategies by combining candlestick patterns with other indicators like volume and support/resistance levels. It’s particularly valuable for those focused on equities, forex, or commodities.

Yes, reviewers praise its clarity, practical examples, and actionable insights. Traders report improved success rates by integrating its methods, with some noting a 15% increase in backtesting accuracy. The lack of real-company case studies is a minor critique, but the book’s focus on pattern psychology and application makes it a standout resource.

Key patterns include:

• Doji: Signals market indecision, often precedes reversals.
• Spinning Tops/High Wave: Indicates uncertainty, common at trend turning points.
• Long Real Bodies: Reflects strong buying/selling pressure, confirms trends.

The book emphasizes combining these with volume analysis and trendlines for higher-confidence trades.

While Japanese Candlestick Charting Techniques introduced candlesticks to the West, The Candlestick Course focuses on hands-on learning with quizzes and structured exercises. It’s more actionable than Beyond Candlesticks, which delves into advanced theory. Together, they form a complete toolkit for traders.

Some readers note the absence of real-world company examples and overly simplified explanations for complex patterns. However, most agree its strength lies in foundational training rather than advanced case studies. The Kindle edition’s formatting challenges are also mentioned.

The book ties candlestick shapes to trader sentiment. For example, a Long Bullish Candle reflects buyer dominance, while a Bearish Engulfing Pattern signals seller takeover. By decoding these visual cues, traders anticipate shifts in supply/demand dynamics.

Absolutely. Nison advocates blending candlesticks with Western techniques like moving averages, RSI, and Fibonacci retracements. For instance, a bullish Hammer pattern near a Fibonacci support level strengthens buy signals. This hybrid approach is a core theme.

Steve Nison, known as the “father of modern candlestick charting,” has 30+ years in finance. He introduced candlesticks to Western traders via his 1991 bestseller and has advised firms like J.P. Morgan and Goldman Sachs. His CMT designation and Merrill Lynch experience underpin his credibility.

The book teaches reversal confirmation through multi-pattern sequences. For example, a Doji followed by a Bearish Engulfing Pattern at a market top signals a likely downturn. Traders learn to wait for closing prices to avoid false signals, reducing risk.

Its step-by-step structure starts with single-candle analysis before progressing to complex formations. End-of-chapter quizzes (e.g., identifying patterns in sample charts) cement understanding. Unlike denser texts, it avoids overwhelming readers with excessive jargon.

Despite market evolution, candlestick principles remain timeless. The book’s focus on price-action psychology applies to cryptocurrencies and algorithmic trading. Updated editions or companion materials by Nison could address modern tools, but the core strategies stay indispensable.