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Can 1-day candlestick patterns be profitable on the 30 component stocks of the DJIA?

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  • Tsung-Hsun Lu
  • Yung-Ming Shiu

Abstract

We set out in this study to conduct a comprehensive analysis of the profitability of every possible 1-day candlestick pattern using data on the 30 component stocks of the Dow Jones Industrial Average index. Our study involves a very lengthy sample period running from January 1974 to December 2009, with the results revealing a noticeable increase in the predictive power of 1-day candlestick patterns from 1992 onwards. Our evidence shows that several of the patterns may well prove to be profitable for the Dow Jones Industrial Average stocks. The robustness of our results is subsequently confirmed based upon a bootstrap analysis.

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  • Tsung-Hsun Lu & Yung-Ming Shiu, 2016. "Can 1-day candlestick patterns be profitable on the 30 component stocks of the DJIA?," Applied Economics, Taylor & Francis Journals, vol. 48(35), pages 3345-3354, July.
    • Handle: RePEc:taf:applec:v:48:y:2016:i:35:p:3345-3354
    DOI: 10.1080/00036846.2015.1137553
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