TRADE SUPPORT= TRADE MARUBOZU

GENTS,
SEE LINK
a BLOG BY jONATHAN
http://www.atradeaday.com/2007/10/04/trading-the-marubozu/

sEE WHAT HE SAYS
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In order to understand why this is significant,

you need to remember that the stock market works on supply and demand.

A Marubozu has just demonstrated a enormous jolt of demand.

Now as the stock consolidates, we look for a setup above the consolidation. Demand has become apparent through the appearance of the marubozu. Now it’s just a matter of a continuation of this demand
The second way in which I use a marubozu is when they occur two or more days in a row. Marubozus are rare. If you see true marubozus two or more days in a row, you are doing well. However, the pattern I’m describing typically consists of an opening or closing marubozu and then more long candles with very small shadows.

The setup here is based off extremes. The stock moves two or more days down with a marubozu and other “marubozu like” candles. My setup occurs when the trend changes abruptly. The most desired setup is for a marubozu in the opposite direction. The higher the opening, the better.
The logic behind this is we’ve had an extreme move in one direction and then a sudden reverse in the other direction. If the stock was moving down and the reverses up, I can trap the sellers. If the stock was moving up and reverses down, I trap the buyers.

What’s important to keep in mind when looking at this pattern is the psychology.
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