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Scanning for Hammers with Candlestick PCFs Topic Rating:
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Craig_S
Posted : Thursday, October 28, 2004 10:39:44 PM


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Author: Craig Shipman








keywords: candlestick Candlestick hammer hammers hanging man PCF personal criteria formula formulas reversal pattern patterns easyscan sort


- Craig
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To view this video you must have Macromedia Flash Player and Microsoft Internet Explorer 5+
Craig_S
Posted : Friday, October 29, 2004 2:50:45 AM


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Here are the two PCFs used in the video

Body as % of Shadow
ABS(C - O) / (H - L) * 100

Body Center as % of Shadow
(((C + O) / 2) - L) / (H - L) * 100

Enjoy!




- Craig
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SirMaelstrom
Posted : Wednesday, December 15, 2004 12:59:28 AM
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Joined: 10/7/2004
Posts: 9
Thanks Craig! Your video provides excellent explanations on how to code a hammer in PCF.

As you show on your video we can setup the “Body as % of Shadow” and “Body Center as % of Shadow”. I call those adjustments “Margin”.

A popular author about candlestick pattern proposed a shadow at least three times the length of the body and the body should be located within the first 1/3 of the candle. Of course this is the theory. In practice the candle may deviate from that perfect figure and still be valid… This brings me to the concept of “Margin”.

For example the Doji is a little cross. Its PCF is:

c = o

…which means the close is equal to the open or the reverse. That’s it!

However in practice the Doji may deviate from the perfect formula and still be valid. Therefore I introduce a “Margin” of 10% in my candlestick pattern PCF:

abs(o - c) <= 0.1*(h - l)

… which mean that we accept that the open minus the close (or vice-versa) can be less or equal to 10% of the shadow length (high - low).

This bring my to my Questions:
------------------------------

1) How much margin should we put for each individual candlestick reversal patterns?

2) Are you aware of any study (like back testing) that optimizes the margin for each candlestick patterns? …optimization in order to increase the yield of success of each play…


Thanks very much

Craig_S
Posted : Wednesday, December 15, 2004 9:03:59 AM


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I don't know a real answer to this exists. I would say it really depends on the trader. Is 10% acceptable to you? If so let it go! If not, what is?

As an aside... try this PCF for me:

ABS(O-C)/(H-L)*100

It is a small reworking of your PCF. It will return, as a percentage, how the body compares to the whole candle. A value of "10" is 10%. Sort a watchlist by this criterion in ascending order. Look at the charts. The ones at the top should look like Dojis... what value shows when they stop? This may be YOUR margin.

Make sense?

- Craig
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SirMaelstrom
Posted : Wednesday, December 15, 2004 11:11:18 AM
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Posts: 9
That's a great idea! I will definitely give it a try and conduct my own study.

Many thanks.
james71
Posted : Thursday, December 16, 2004 2:37:13 PM
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Joined: 12/16/2004
Posts: 24
I am a beginner on TC2000 as well as trading so please excuse my ignorance. I was looking forward to giving the hammer/hangman scan ago but only got as far as the value/rank gauge. My gauge starts at 570.88 and goes up to 7051.31, what does this mean?
Doug_H
Posted : Thursday, December 16, 2004 2:38:37 PM


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For which condition do you see these values?

- Doug
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james71
Posted : Thursday, December 16, 2004 3:49:08 PM
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Body center as % of shadow looks like this;
-228.52 90
-1025.63 75
-1961.91 50
-3465.57 25
-6281.82 10
VALUE RANK
Body as % of shadow looks like;
90
7051.31 75
4028.33 50
2159.38 25
570.85 10
VALUE RANK
Doug_H
Posted : Thursday, December 16, 2004 3:59:00 PM


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james71:

Did you copy and paste the formulas that Craig posted below the video? Did you update them for All Items in System?

Let me know, and we'll get this resolved for you.

- Doug
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james71
Posted : Thursday, December 16, 2004 5:01:27 PM
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Posts: 24
Doug, Thankyou for help..I've now got it sorted.
Doug_H
Posted : Thursday, December 16, 2004 5:21:44 PM


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Great! I'm glad it's working for you now!

- Doug
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Goldengate
Posted : Thursday, March 24, 2005 6:46:20 AM
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Joined: 2/2/2005
Posts: 9
I have watched the video about Doji's followed by a gap, but when I try to make a new easy scan I don't have the open/close etc. in my drop down box. Where can I find them?
Craig_S
Posted : Thursday, March 24, 2005 7:11:36 AM


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The PCFs for that video can be found below it. Scroll under the video and you should find everything you need.

- Craig
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Goldengate
Posted : Thursday, March 24, 2005 9:29:41 PM
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Posts: 9
Thank you. I am new to this and finally understood that I have to enter my own PCF's and name them. When I did this things are working GREAT! My next question is, how do I write a PCF if I am wanting to limit my search to stocks between $5-50 and with a volume of 200,000?
Craig_S
Posted : Thursday, March 24, 2005 10:23:55 PM


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You only need to add these conditions (not PCFs, they are already in your system):

Price Per Share
(limit to a value of 5 to 50)

Volume Today
(limit to a value of 2000 to MAX - volume is in hundreds)

Here is a video to help you along:

(and thanks for the high rating on my post!)

Using EasyScan to find stocks that meet your own criteria

- Craig
Here to Help!
dashriprock
Posted : Monday, May 02, 2005 2:42:10 PM
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Joined: 3/3/2005
Posts: 5
Hi Craig
When I go to the pcf,s the option for the candle bodys are not there.
Do you have any suggestions.?
Craig_S
Posted : Monday, May 02, 2005 2:55:42 PM


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Yes. You have to create them. The formulas for these conditions are under the video (above here).

Here is a video on creating PCFs

How to create a Personal Criteria Forumula (PCF)

Watch this video then use the formulas above to get these conditions in your system.

- Craig
Here to Help!
odejonge
Posted : Tuesday, May 10, 2005 9:41:45 AM
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Joined: 12/9/2004
Posts: 48
I'm attempting to modify my hammer/hanging man pcf's to instead search for a "shooting star" candle pattern. Evidently I'm not using the right approach to changing the values in "body as % of shadow" or "body center as % of shadow". And perhaps this is not the right approach at all? Please help me with the correct "answer" to this puzzle. Of course what I'm looking for is a long upper shadow as compared to a smaller (lower) body.
Thanks for any help you can give me.
Bruce_L
Posted : Tuesday, May 10, 2005 10:19:57 AM


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odejonge,
Like Hanging Man or Hammer, Body as % of Shadow must be small. Body Center as % of Shadow is on the opposite end of the spectrum however and the rangefinder should be small and extend all the way to the bottom instead of small and extending all the way to the top.

I have found adding the following PCF as a condition of my EasyScans helps by eliminating completely flat candlesticks.

H<>L

-Bruce
Personal Criteria Formulas
TC2000 Support Articles
odejonge
Posted : Tuesday, May 10, 2005 2:15:49 PM
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Joined: 12/9/2004
Posts: 48
Although much better, many still look more like doji's or spinning tops, many also with bodies in the middle of the candles. Also, the candles appear to be relatively small in length as compared to most of the hanging man candles that I typically see. Perhaps there just aren't many classic examples available right now? Or maybe I'm still not entirely sure how to set the rank or value parameters in "Body Center as % of Shadow"? Presently I have it set: Rank = 1 to 11. Is that correct? Thanks a bunch for your help.
Bruce_L
Posted : Tuesday, May 10, 2005 4:58:47 PM


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odejonge,
I must admit to actually using some additional PCFs when identifying candlestick patterns using this technique.

Body Bottom as % of Shadow:
(O+C-2*L-ABS(O-C))/(H-L)*50

Body Top as % of Shadow:
(O+C-2*L+ABS(O-C))/(H-L)*50

My Shooting Star EasyScan has the following settings:

Body as % of Shadow:
Value = Min to 25

Body Top as % of Shadow:
Value = Min to 25

If you wish to avoid completely flat bodies, you may wish to use something like Value = 5 to 25 for Body as % of Shadow instead.

-Bruce
Personal Criteria Formulas
TC2000 Support Articles
odejonge
Posted : Friday, May 13, 2005 3:29:03 PM
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Posts: 48
After a couple of days trial, I'm now getting some real good "shooting stars". I know they occur somewhat infrequently, and I use a limited scan, so I probably just had to try this out until successful.

Thanks again for your help on this one.

-Bill
HEMIK
Posted : Saturday, June 18, 2005 4:04:21 AM
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Joined: 5/6/2005
Posts: 7
QUOTE (james71)
I am a beginner on TC2000 as well as trading so please excuse my ignorance. I was looking forward to giving the hammer/hangman scan ago but only got as far as the value/rank gauge. My gauge starts at 570.88 and goes up to 7051.31, what does this mean?<img src="/training/images/emoticons/smile004.gif"/>


Hi Hemik Make sure when using the gauge it is all the closed before clicking and draging. Example when blue is showing there should be no
white showing at the min or Max before you start your adjustments
this should help.
pinche
Posted : Wednesday, June 22, 2005 3:47:03 PM
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Joined: 6/18/2005
Posts: 3
Great video on candle hammers. I followed your instrucions under the new scan, PCF's and there was no candle body entry. Do you have any advice?

Thank you.
Todd
Bruce_L
Posted : Wednesday, June 22, 2005 4:08:17 PM


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pinche,
Did you copy and paste the formulas that Craig posted below the video? Did you update them for All Items in System? Here is a video on creating PCFs:

How to create a Personal Criteria Forumula (PCF)

-Bruce
Personal Criteria Formulas
TC2000 Support Articles
pinche
Posted : Wednesday, June 22, 2005 4:13:17 PM
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Joined: 6/18/2005
Posts: 3
Thank You, I just saw them.

Todd
sgerrand
Posted : Thursday, November 24, 2005 8:15:36 AM
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Joined: 11/24/2005
Posts: 1
Hi, I've just signed up for Telechart and would like to know how (if possible) can I scroll over the chart to view the daily open/close/high/low??

Regards
Steve
Craig_S
Posted : Thursday, November 24, 2005 9:31:04 AM


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Yes.

If you press your period (.) or full-stop key twice it will bring up the pointer crosshair and the data window. You can then use your mouse or the arrow keys on your keyboard to scan through.

- Craig
Here to Help!
whitelinerider
Posted : Monday, December 05, 2005 6:07:47 PM
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Joined: 3/9/2005
Posts: 15
Hi.. another great video. I know cause I understood it...
Well not all, what purpose does it serve? Would not scanning for price in a certain range or useing moving averages get you the same results. I have found that there are many indicators and pcf's. What I am trying to come up with is a few that I can focus on and use, without overlapping.. thanks as always.
Craig_S
Posted : Monday, December 05, 2005 7:24:52 PM


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Candlestick patterns are popular and requested. This led to the video. You decide if any pattern is valid and fits your analysis style.

This video teaches how to search for the pattern but, in no way, validates it.

- Craig
Here to Help!
toddland
Posted : Monday, May 08, 2006 7:38:32 PM
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Joined: 3/1/2006
Posts: 11
Hello. I have tried to add the two pcf in the video for hammer and hangingman. However instead of giving me a range, it gives me true of false? I'm using TC2005
Craig_S
Posted : Monday, May 08, 2006 7:39:29 PM


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Please copy and paste the PCFs from your system here so I can look them over.

- Craig
Here to Help!
toddland
Posted : Monday, May 08, 2006 7:49:58 PM
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Posts: 11
ABS(C - O) / (H - L) * 100
(((C + O) / 2) - L) / (H - L) * 100

Also, please check the ones I'm using for doji's

O1 / C1

H1 / L1
Craig_S
Posted : Monday, May 08, 2006 8:12:28 PM


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Be sure these are built as 4 seperate PCFs.

If they are you should get your range selectors.

- Craig
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toddland
Posted : Monday, May 08, 2006 9:18:28 PM
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they are all built as four seperate pcfs
Doug_H
Posted : Monday, May 08, 2006 9:29:42 PM


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When you add them to your EasyScan, are you adding 4 separate conditions? The PCF's you showed are not of the type that would give you a True/False result if they are entered separately as 4 individual PCF's.

- Doug
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toddland
Posted : Monday, May 08, 2006 9:34:34 PM
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Posts: 11
yes each one is a separte condition. Is there a way I can add a screenshot so you can see what I see?
Craig_S
Posted : Monday, May 08, 2006 10:00:30 PM


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Do me a favor.

Edit this PCF:

Body as % of Shadow
ABS(C - O) / (H - L) * 100

Change the test symbol to IBM and give me the numbers and the result that shows up.

- Craig
Here to Help!
toddland
Posted : Monday, May 08, 2006 10:17:02 PM
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Posts: 11
Here are the #'s ABS(82.89 - 82.60) / ( 83.22 - 82.30) * 100.00 and the result was 31.52
Craig_S
Posted : Monday, May 08, 2006 11:15:10 PM


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OK. Now create a new EasyScan with just that criterion. Does it give a range selector?

- Craig
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