In my trading, I almost always track the formation of candlestick patterns. In my opinion, they are an effective tool for market analysis. There are a lot of candlestick models, but their effectiveness is different. In this article, I want to tell you about the Force Bar pattern . It can be seen quite often on the price chart of a currency pair or other traded asset. The strength bar works out successfully in most cases. This pattern can be used in trading both as a main signal and as a confirmation of a signal received from other technical analysis tools.
The Force Bar can be seen when the market sentiment changes dramatically. The upward movement is replaced by the downward movement and vice versa. The pattern indicates this. It is a candle with a large body. At the same time, there is practically no shadow on one side of the body. Let’s analyze this in more detail.
Bullish Force Bar
A certain market situation is necessary for the formation of a bullish Power Bar. It can be a downtrend, or the completion of a correction on an upward movement. If we see that a candlestick of the opposite direction with a long body, which has no upper shadow, appears on the chart, then this is the “bullish” version of the Force Bar. You can enter the market immediately after the close of such a candle.
As you can see, at the end of a strong downtrend, a bullish candle appeared on the chart. Her body is large. In this case, the maximum is equal to the closing price, that is, there is no upper shadow. At the opening of the next candle, you can enter the market. In this case, the stop-loss should be placed slightly below the low of this candle. Then you can move it to the breakeven level.
Bearish Force Bar
Conditions for the formation of the “bearish” Force Bar are similar.
A force bar appeared at the top of the upward movement. This is a bearish candlestick with a long body and the closing price coincides with the low of the move. That is, there is no lower shadow. This means that the bears are strong enough, and the fall in prices is likely to continue. You can open a sell order. SL – slightly above the maximum.
To begin with, I recommend looking at how the Force Bar works on history. After that, you can easily track it in real trading. If your TS, for example, signals a favorable market situation for buying, and at the same time a “bullish” Power Bar has formed, then such a signal can be more trusted.