Stacey Burke’s 12 Candles

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This indicator has many components; below, each component is explained and how it can be used as a trading tool.

Future Lines

Vertical lines are projected into the future to mark the beginning of each of the three major markets: Tokyo, London, and New York.

  • When major markets open, this can cause an increase in price action. So this component provides the trader with a reminder of when the next major market opens.
  • Also, the days of the week are displayed to allow the user to backtest price reactions for certain days of the week easily (e.g., Major Markets reopening after the weekend).

12 Hour Candle Sessions High and Low

  • As price intersects with the beginning of the session, the vertical line disappears, and two corresponding horizontal lines begin. These horizontal lines dynamically adjust to mark each session’s high and low, and a semi-transparent box fills the space between the high and low lines.
  • The duration of each session is a three-hour window, which each consists of 12 Fifteen-Minute Candles. This marks the hour prior to equity markets opening, the opening hour, and the post-open hour.
  • The session’s highs and lows can be selected within the settings shown for a 24 hour period. This assists the trader with session range breakouts; three examples of how this could be traded are below.

Example 1

  • The Tokyo and London session high kept the price action within a range. Once it broke the range, the Tokyo and London session highs were used as support, resulting in a range breakout.

Example 2

  • The below picture shows price action failing to break London Session Low and New York Session High; this is followed by Tokyo Low acting as resistance and price moving down 9%.

Example 3

  • Below price action with an increased volume of 323% (based on the average of the last 10 bar) fails to break the Tokyo High on the 1st attempt. The second attempt fails on 241% volume. The third attempt at 475% breaks the range, completing the range breakout and seeing a move of 3.4% in price.

High of Day (HOD) and Low of Day (LOD)

  • As the trading day unfolds, we mark the HOD (d-High) and LOD (d-Low) with blue dotted horizontal lines. Then at the start of the next trading day, the former High and Low become the Previous Day High (pd-High) and Low (pd-Low) and are changed to dashes.
  • These high and low levels add extra confluence with the session high and lows for Swing Failure Patterns (SFP) and confirmation of trends.

Round Numbers

  • As humans, it’s hard to use just any number to make sense of things. We prefer to use round numbers. This is important for trading as many traders will automatically use round numbers as their stop losses.
    This indicator component reminds users of this fact and displays round numbers such as 00, 25, 50, and 75. The indicator automatically calculates and displays lines for the round numbers for as many as twelve levels above and below the current price.
  • Below are examples of how round numbers are broken to trigger stop losses; you may want to break the habit of using round numbers as your stop losses.

Below is the indicator in full swing, displaying all the elements described above.

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