Candlestick Charting and Trading Volume: Evidence from Bursa Malaysia

Chee, Ling Chin and Mohamad, Jais and Sophee Sulong, Balia and Ayoib, Che Ahmad and Azlan, Zainol Abidin (2016) Candlestick Charting and Trading Volume: Evidence from Bursa Malaysia. International Review of Management and Marketing, 6 (s8). pp. 153-165. ISSN 21464405

[img]
Preview
PDF
Candlestick Charting and Trading Volume.pdf

Download (239kB) | Preview
Official URL: http://www.econjournals.com

Abstract

Technical analysis is deemed to be a futile practice among academicians who propose efficient market hypothesis, typically the weak form market efficiency which strongly protests the application of past prices and trading volume data for prediction of future market movement. As candlestick charting is one of the oldest technical indicators for short term investment, therefore this study examines the predictability of candlestick charting with combination to trading volume for Malaysian stock market within the period of 2000-2014. Skewness adjusted t-test is employed to test the statistical significance of candlestick returns. After taking into account the transaction costs and also out-of-sample test as robustness checking, the findings show that only bullish reversal patterns prior to trend are profitable for investors while most of the bearish reversal patterns have shown significant predictive power both before and after trend. The effective holding period for candlestick reversal patterns tend to accumulate around 10-15 day holding period.

Item Type: Article
Uncontrolled Keywords: Efficient Market Hypothesis, Technical Analysis, Candlestick Charting, Reversal Patterns, unimas, university, universiti, Borneo, Malaysia, Sarawak, Kuching, Samarahan, ipta, education, research, Universiti Malaysia Sarawak
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HG Finance
Divisions: Academic Faculties, Institutes and Centres > Faculty of Economics and Business
Faculties, Institutes, Centres > Faculty of Economics and Business
Depositing User: Mohd Razali
Date Deposited: 17 Oct 2017 01:32
Last Modified: 17 Oct 2017 01:32
URI: http://ir.unimas.my/id/eprint/18130

Actions (For repository members only: login required)

View Item View Item