The candlestick trading bible

144
THE CANDLESTICK TRADING BIBLE 
The illustration below shows how sellers broke the support level, the 
formation of the inside bar pattern after the breakout of this level 
signals indecision in the market. 
Right now, no one knows if the support level is really broken, if you sell 
at market immediately after the breakout of this level, you are making 
an aggressive entry, which is little tricky and dangerous, because the 
breakout is not confirmed. 
But if you are used with trading inside bars and you understand the 
psychology behind their formations, you will know that the safest 
entry should be after the breakout of this pattern. 
The breakout of this candlestick pattern is a clear confirmation that 
the market is not still in an indecision period, and sellers are obviously 
in control of the market. See another example. 

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145
THE CANDLESTICK TRADING BIBLE 
The chart above shows how the market participants interact with 
these levels, and how the resistance level acts as barrier. 
The market has had difficulty rising above; this horizontal level 
prevents buyers twice from rising any further. But in the third attempt, 
buyers broke through the resistance level. 
What is interesting is what happened after the breakout, look at the 
chart again, you will notice that there is a clear inside bar pattern 
formed over there. 
The formation of this price action pattern indicates that the breakout 
is not yet confirmed, remember, an inside bar formation means 
indecision and hesitation. So, you have to be careful, and bear in mind 
that a false breakout scenario is possible. 
What will make a difference between you and other traders is your 
deep understanding of how this pattern works, in this chart above, you 
will know that the best time to place a buy order should be after the 
breakout of the inside bar pattern not after the breakout of the 
horizontal level. 

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