Mastering the Hollow Candle Chart Pattern on TradingView for Accurate Market Analysis

Quick Facts
Unlocking the Power of Hollow Candles
Hollow Candle Characteristics
How to Identify Hollow Candles on TradingView
How to Use Hollow Candles in Chart Trading
Common Candlestick Patterns Involving Hollow Candles
Real-Life Example: Hollow Candles in Action
Limitations of Hollow Candles
Frequently Asked Questions
Additional Resources

Quick Facts

1. A hollow candle is a candlestick pattern that appears as an empty space within a bar on a hollow candles chart.
2. Hollow Candles Chart TradingView are also referred to as Shanti hollows or hollowed bars, but another variant sees a bare bar.
3. The hollow body is considered a bullish sign, suggesting that a decrease in price is occurring but does not persist.
4. Charts showing hollowed bars are assumed to belong to buyers, since the bars are considered to be inside out from a buyer’s view.
5. They represent a decrease that eventually prevails over the reversal price.
6. There are 2 types of hollow bars; those with a tall thin upper shadow, commonly said to signal that the price bar is reaching high levels, but it is weak support to these same price movements.
7. Another type of hollow bar is one that has both an upper and a lower, but are of equal height as the actual bar value in the chart.
8. Chart traders who believe they are an unfavorable indicator and instead are a cause for sellers, looking for breaks below the hollow bars themselves.
9. 2+ hollow bars together are almost universally associated with reversals, (if the bar at the close of the period of hollow bars itself was not closed at the peak high of the hollow bar, then they signify some substantial sell-off in the market.)
10. This strong reversal is expected to carry a near complete reversal after the level of the hollow bars themselves had been beaten down, but also for 2+ hollow bars since the last high has gone significantly beyond any prior highest high since the beginning or the trading period.

Unlocking the Power of Hollow Candles: A Guide to Chart Trading with TradingView

As a trader, you’re constantly on the lookout for new ways to gain an edge in the markets. One often-overlooked tool that can help you make more informed trading decisions is the humble hollow candle. In this article, we’ll delve into the world of hollow candles, exploring what they are, how they’re used, and how you can incorporate them into your chart trading strategy with TradingView.

Hollow Candle Characteristics:

Characteristics	Description
Color	White or hollow body
Body	Closing price higher than opening price
Formation	Can occur in isolation or as part of a larger pattern

How to Identify Hollow Candles on TradingView

Identifying hollow candles on TradingView is relatively straightforward. Here’s a step-by-step guide to get you started:

Step 1: Open TradingView
Navigate to TradingView.com and open a new chart for the security you’re interested in analyzing.

Step 2: Select the Candlestick Chart
Choose the candlestick chart type from the top toolbar.

Step 3: Identify the Hollow Candle
Look for candles with a hollow or white body. These indicate a bullish sentiment and can be a sign of a potential uptrend.

How to Use Hollow Candles in Chart Trading

Hollow candles can be used in a variety of ways to inform your trading decisions. Here are a few strategies to get you started:

Strategy 1: Buy Signals
Use hollow candles as a buy signal when they appear at key support levels or after a prolonged downtrend.

Strategy 2: Trend Confirmation
Combine hollow candles with other technical indicators, such as moving averages or RSI, to confirm an existing trend.

Strategy 3: Reversal Detection
Look for hollow candles after a sustained downtrend as a potential sign of a reversal.

Common Candlestick Patterns Involving Hollow Candles

Hollow candles can also form part of larger candlestick patterns, providing additional insights into market sentiment. Here are a few examples:

Pattern 1: Hammer
A hammer pattern occurs when a hollow candle forms after a downtrend, indicating a potential reversal.

Pattern 2: Bullish Engulfing
A bullish engulfing pattern occurs when a hollow candle completely engulfs the previous candle, indicating a strong buying signal.

Pattern 3: Piercing Pattern
A piercing pattern occurs when a hollow candle forms after a gap down, indicating a potential reversal.

Real-Life Example: Hollow Candles in Action

Let’s take a look at a real-life example of hollow candles in action. In the chart below, we can see a series of hollow candles forming after a prolonged downtrend in the EUR/USD currency pair.

Limitations of Hollow Candles

While hollow candles can be a powerful tool in your trading arsenal, they’re not without their limitations. Here are a few things to keep in mind:

Limitation 1: Context is Key
Hollow candles must be considered in the context of the broader market trend and other technical indicators.

Limitation 2: Overreliance
Relying solely on hollow candles can lead to false signals and trading decisions.

Limitation 3: No Guarantee
Hollow candles are not a guarantee of future performance and should be used in conjunction with other forms of analysis.

Frequently Asked Questions:

Hollow Candles Chart TradingView FAQ

Overview

Hollow Candles Chart is a popular indicator on TradingView, used by traders to identify trends and potential reversal points in the market. Here are some frequently asked questions about Hollow Candles Chart TradingView:

Q: What is Hollow Candles Chart?
A: Hollow Candles Chart is a candlestick chart pattern that displays hollow bodies when the close price is higher than the open price, and filled bodies when the close price is lower than the open price.

Q: How does Hollow Candles Chart work?
A: Hollow Candles Chart works by analyzing the open and close prices of each candlestick to determine whether the body should be hollow or filled. This helps traders to quickly identify the direction of the trend and potential reversal points.

Q: What are the benefits of using Hollow Candles Chart?
A: Some benefits of using Hollow Candles Chart include:

* Simplified trend analysis
* Identification of potential reversal points
* Enhanced visualization of market trends

Q: How can I install Hollow Candles Chart on TradingView?
A: To install Hollow Candles Chart on TradingView, follow these steps:

1. Open your TradingView account and navigate to the “Indicators” tab.
2. Search for “Hollow Candles Chart” in the indicator library.
3. Click on the “Add to chart” button to install the indicator.
4. Configure the indicator settings to your liking.

Q: Can I customize the appearance of Hollow Candles Chart?
A: Yes, you can customize the appearance of Hollow Candles Chart by adjusting the indicator settings. This includes changing the color scheme, body type, and other visual elements.

Q: Is Hollow Candles Chart suitable for all markets and timeframes?
A: Hollow Candles Chart can be used in various markets and timeframes, but it’s essential to test and validate the indicator in your specific trading environment before using it as part of your trading strategy.

Additional Resources

* TradingView Documentation
* Hollow Candles Chart Tutorial