September 20th Market Direction

The market indexes not showing any dramatic force one way or the other but the underlying factor of the indexes continuing to trade above the T-line at least provides a greater probability prospect that the uptrend remains in progress. This analysis may not be anything more than analyzing the lack of any great selling pressure in the market, allowing for specific bullish candlestick chart patterns to continue working. Numerous J-hook patterns i.e.DOCU continue to perform, as well as frypan bottom patterns working.

September 19th Market Wrap-Up

Today’s indecisive trading in the markets continues to demonstrate one important trend factor, the indexes are still trading above the T line. There is prospects of a J-hook pattern forming in each of the indexes. This would have very relevant ramifications for the next trend move. If wave three equates to wave one of a J-hook pattern, that means the market indexes will be moving to all-time highs. Currently there is no major change of investor sentiment as long as the indexes continue to trade above the T line without any candlestick reversal signals. This analysis allows investors to maintain positions on trading days that normally make most investors nervous. Because human nature works the same way time after time, utilizing the simple trend indicators in conjunction with candlestick signals and patterns keeps an investor from being whipsawed in and out of positions.

The J-hook pattern and the frypan bottom pattern have produced trade set ups that have high probabilities of not only moving in the correct direction but also with a strong price move. When a candlestick pattern is developing while using the T line as a support level, it adds that much more credibility to the pattern expectations. This could be seen in a number of stock positions in today’s trading. There are two major benefits of utilizing candlestick patterns. First, the probabilities of a trade moving in the expected direction is extremely high. This is based upon hundreds of years of witnessing what occurs in human nature. Secondly, the results of patterns usually create much stronger returns than merely uptrending stocks during an uptrending market. Having this information allows an investor to dramatically improve the profitability of their portfolio by not only being in the right place at the right time, but also being in very strong price moves at the right time.

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The Candlestick Forum Team


September 19th Daily Market Comments

The Dow and S&P closed positive yesterday, but more importantly all the indexes close backup near the high end of their trading range, staying above the T-line. Today’s positive trading if maintained going into the close is creating J-hook patterns in all the indexes. This is relevant with the calculation that wave three be in the same magnitude as wave one of the J-hook would put the indexes into new all-time high territory. The important factor is the trading above the T-line demonstrates bullish sentiment is still in control of the market trend. Stay predominantly long, any short positions should be watched more closely with the indexes continuing higher.


September 18th Daily Market Comments

The markets are in a holding pattern, waiting to see what the feds are going to do about interest rates. Unfortunately, until the meeting the markets are probably going to be trading very lethargically. Continue to hold long and short positions that are maintaining their trends above or below the T-line. The indexes continue to trade above the T-line, implying the uptrend remains in progress. Obviously the markets was so their reaction to whatever the feds announce about interest rates Today.


September 17th Daily Market Comments

Today’s trading continues to illustrate indecisive consolidation. The Dow trading lower but above where it opened, the S&P 500 trading absolutely flat, and the NASDAQ trading relatively flat since the open. The big mover is crude oil with Saudi Arabia announcing they should be back in full production in just a matter of a couple weeks. The uptrend is in a consolidation stage but still trading above the T-line, making each individual stock chart the main criteria. Stay predominantly long but have a few short positions in the portfolio.


September 16th Market Direction

The Dow formed Doji’s in the overbought condition on Thursday and Friday of last week. This created the prospects that a lower open in Monday’s trading would indicate at least a profit-taking pullback to the T-line area. The attack on the Saudi Arabian oilfields provided the stimulus for selling on the open today. Was this evidence of a market reversal? Because candlestick analysis is based upon a visual assessment of investor sentiment, analyzing the overall market trend can be done in the matter of seconds when knowing what should occur after candlestick signals in conjunction with high probability trend indicators. The analysis of the trend using only the Dow would not provide a full assessment of investor sentiment. Although the NASDAQ closed lower today, it opened at the T line and began trading positive. This clearly illustrated that there weren’t selling forces occurring in the NASDAQ, buying was occurring after the open. The S&P 500 traded lower but traded at the same level as where it opened, creating an indecisive Doji day. This immediately reveals the selling was not being done with any great conviction. But there is one additional very compelling indication the markets were not going to be selling off with great aggressiveness. The number of bullish charts continuing to trade bullish! Candlestick signals and patterns are created by the graphic depiction of human nature. An accumulated watchlist of candlestick charts can be a good indicator when revealing that a large percentage of bullish patterns continue to trade bullish indicates there is not any across-the-board selling of the markets. The results of bullish candlestick charts not only indicate that the market is not selling off, they are also allowing for profitability of a portfolio based upon the results of those charts versus the market direction be in the predominant profit element.

When numerous positions continue to trade positive in a sluggish or bearish trending market day, it can be assumed that there isn’t a rampant selling occurring in all positions, the market in general may just be consolidating. Candlestick analysis provides two very powerful analytical aspects. First, it identifies when investor sentiment is indicating a high probability of a bullish or bearish move, such as our recommendation on NVAX, utilizing the candlestick signals at support areas such as the 50 day moving average that everybody else’s watching. Secondly, with crude oil prices jumping up dramatically, the candlestick charts reveal that oil stocks are gaining the most bullish sentiment. The strongest bullish signals can now be utilized to identify which of those stocks in that sector are going to perform the best. Today, numerous best friend signals at breakout levels provide a simple visual method to cultivate the best trades based upon influences of that sector. This is a process of a utilizing the information built into candlestick charts to put your investment funds in the most powerful investment positions.


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Good Investing,

The Candlestick Forum Team

September 16th Daily Market Comments

The Doji in the Dow on Friday, a good distance away from the T-line, created the possibility of a lower open making the likelihood of a pullback to the T-line a greater possibility. Did the attack on the Saudi Arabian oil fields cause that result? Obviously yes, but also demonstrating investor sentiment be in overbought, negative news is more likely going to stimulate profit-taking/selling. But this is where analyzing the other indexes help to evaluate whether there is rampant selling in the markets. The NASDAQ, although trading lower, opened at the T line and showing bullish trading since the open. The S&P 500 is trading where it opened, not demonstrating any aggressive selling. Continue to utilize each individual stock chart as the main criteria. There is currently no signals showing the Bears are taking control.


09/19/2019 Stock Chat with Lane Mendelsohn

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Stock Chat – Thursday 09/19/19

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September 13th Daily Market Comments

The decent retail numbers appears to have kept the bullish sentiment continuing in this market trend. The prospects of reaching the all-time highs are being touted on the financial talkshows. Currently the market uptrends are being supported above the T-line and more specifically the 3T-line is acting as support. Continue to maintain bullish positions as long as they remain above the T-line.

September 12th Market Wrap-Up

Today the market indexes produced Doji’s, showing some indecision as the markets approach the recent all-time highs. With the indexes in the overbought condition, the tweets about China trade talks make the investor sentiment that much more sensitive. Today’s Doji makes tomorrow’s analysis relatively simple. The market will likely move in the direction of how they open after today’s Doji, the simple Doji rule. The distance away from the T line is also an alert there may be a better possibility of at least a profit-taking pullback in the markets. Numerous stock charts have indicated potential reversal signals, implying it is time to be prepared to take profits. Being able to identify what the overall market sentiment is revealing allows the candlestick investor to be more prepared for watching for a change of market direction/closing long positions. If the premarket futures show a lower open in Friday’s trading, anticipate the potential pullback to the T line. A positive open would imply bullish sentiment testing the recent highs.

The visual aspects of candlestick charts make it much easier to identify when profit-taking/selling is about to occur in price trends when sell signals are occurring at obvious resistance levels. WB is an example of a sell signal occurring when the price moved up to the level where it filled a previous gap. Witnessing potential reversal signals, at levels that everybody else is watching, gives the candlestick investor much faster evidence that it is time to close out positions. Because candlestick signals provide an immense amount of investor sentiment information, an investor does not need to be a sophisticated technical analyst. They merely need to recognize the signals that are showing a change of investor sentiment that have been highly accurate reversal signals based upon the Japanese Rice traders identifying the strong reversal signals over the past few hundred years. You gain greater precision in identifying price movements knowing the reoccurring aspects of human nature that make candlestick signals very accurate.

Chat session tonight at 8 PM ET. Click here to register.

Good Investing,

The Candlestick Forum Team