So What Is a Heikin-Ashi chart and how does it look like?

Heikin-Ashi chart looks like the candlestick chart but the method of calculation and plotting of the
candles on the Heikin-Ashi chart is different from the candlestick chart.
In candlestick charts, each candlestick shows four different numbers: Open, Close, High and Low price
(It is recommended to learn the candlesticks first) and each candlestick is independent and has no
relation with the previous candlestick.

But Heikin-Ashi candles are different and each candle is calculated and plotted using some information
from the previous candle:
1- Close price: the close price in a Heikin-Ashi candle is the average of open, close, high and low price.
2- Open price: the open price in a Heikin-Ashi candle is the average of the open and close of the
previous candle.
3- High price: the high price in a Heikin-Ashi candle is chosen from one of the high, open and close price
of which has the highest value.
4- Low price: the high price in a Heikin-Ashi candle is chosen from one of the high, open and close price
of which has the lowest value.

So candles of a Heikin-Ashi chart are related to each other because the close and open price of each
candle should be calculated using the previous candle close and open price and also the high and low
price of each candle is affected by the previous candle. So a Heikin-Ashi chart is slower than a
candlestick chart and its signals are delayed (like when we use moving averages on our chart and trade
according to them).

What are the advantages and disadvantages of this delay?
This delay has made the Heikin-Ashi candle as a good indicator for volatile currency pairs like GBP-JPY
because it prevents us from rushing and making mistakes amd trading against the market.

Read More......

What Is Heikin-Ashi and How to Trade with It?

In forex or stock market, we can make or lose money when the price goes up and down. We need to be
able to predict the direction of the market. Different traders do this using different methods but for most
traders, technical analysis of the price charts is the easiest way. So they spend a lot of time to learn
technical analysis.

In fact, technical analysis was invented and introduced by Japanese traders and by the invention of the
candlesticks. Those who are familiar with the candlestick charts know that it is the best and fastest way
for understand the condition of the market and the psychological situation of the buyers and sellers.
Japanese traders didn’t stop improving their technical analysis methods and tools. They worked a lot
and tried to make the technical analysis and price prediction easier and faster and Heikin-Ashi chart that
came after the candlestick chart is one of the several different achievements of Japanese traders.

I can not say that you can predict faster using the Heikin-Ashi charts but it is easier than candlestick
charts. In this article, I explain about the Heikin-Ashi charts signals and analysis and will compare it with
the candlestick charts and then talk about my personal opinion about Heikin-Ashi charts and the way
that you can use them in your trades. Read More......