Although the indexes are trading lower today, especially the Dow, they are forming indecisive trading formations as well as staying above the T line. Anticipate this being a profit-taking day as long as there is not any severe selling, taking the indexes back down below the T-line. Be ready to take profits on price moves that are starting to show selling, potential reversal signals in the overbought condition. Do not hesitate to take some profits, if the market continues higher after consolidation, there will be other bullish opportunities.

The markets continue to show good strength, the Dow confirming a J-hook pattern, the S&P 500 not resisting at the 200 day moving average. There is also intraday profit-taking occurring in many of the stocks that have had good strong price moves. Profit-taking is adding strength to the overall trend, diminishing exuberance. Continue to stay long but the emphasis still remains on individual stock charts. Be prepared for sector rotations. Crude oil prices are still in a steady uptrend, watch the oils.

The implication that the T-line was continuing to act as a uptrending support level is obviously further confirmed today. The NASDAQ is potentially forming a Doji sandwich, making the 200 day moving average a viable target. The Dow trading higher indicates the 200 day moving average/T-line area continues to act as a support level. Note that the Dow opened higher, at yesterday’s open and continue to trade higher, making for a small trend kicker signal. The transportation index continues to move higher further confirming the T-line has maintained the uptrend.

The positive trading going into the close on Friday brought the indexes backup above the T-line. Today, although the Dow is trading slightly lower, the NASDAQ and S&P 500 are trading slightly higher. This is currently making the T-line support that much more viable. Most importantly, the transportation index is trading up strong today. This is making the overall prognosis continuing to lean more toward profit-taking occurring during the current uptrend. Note that numerous individual stock charts are in the process of forming J-hook patterns. Watch the T-line.

The evidence of the potential of profit-taking that was illustrated in the candlestick charts over the past two trading days is in progress today. However, the T-line is still acting as a relevant support factor. Both the NASDAQ and the S&P 500 have already tested and bounced back up off the T-line. The S&P 500, failing at the 200 day moving average and then showing support at the T-line creates the possibility of a bobble breakout if the S&P 500 comes back up and test the 200 day moving average. Numerous individual stocks have also appeared to support at the T-line. It will be important to see whether the day finishes near the top end of the trading range or the lower end of the trading range.

Today’s relatively flat trading continues to indicate the lack of any major change of investor sentiment. When the market opens lower, but very mildly lower, that indicates there is some profit-taking but no compelling bearish sentiment coming into the market trend. The lack of any major change of trend direction makes the 200 day moving average a viable target for the NASDAQ as well as the S&P 500. The transportation index is not shown any weakness, using the 3T–line as a trend support. As long as the markets indexes remain in a slow steady uptrend, the strong candlestick breakout patterns will produce good profits without the worry that there is any major change in the overall market. No matter what the rhetoric of Washington DC, the candlestick charts are revealing that investors are still making their decisions based upon other factors.

Today’s positive trading, showing good steady buying, has a little warning flag. The market indexes gapped up Today, although not significantly, but a gap up in the overbought condition. Be diligent, the 200 day moving average is a likely target for this uptrend but be prepared to take profits. Numerous candlestick pattern breakouts are working well today i.e.GPRK. Use the T-line as your ultimate trend reversal indicator.

The analysis remains the same. As long as the market indexes continue their slow steady uptrend, numerous candlestick signals and patterns produce good profits, especially the fry pan bottom breakouts and the J-hook patterns. As long as the talking heads continue to express concern about the market rally, the market rally will continue.

The initial selling today in the Dow was not worry some due to the fact that the other indexes all started trading positive from the get-go. Currently the Dow is trying to nudge itself through the 200 day moving average while the other indexes are trading up with decent strength. Today’s positive trading is confirming the consolidation/J-hook type patterns in the market indexes. This indicates the probabilities of more upside with the NASDAQ having the prospects of heading to the 200 day moving average over the next few trading days. Continue to utilize the strong charts during this uptrend.

Today is a perfect example that prices/trends do not move based upon fundamentals, they move based upon investor sentiment. AAPL good! Hooray, the market is good. The Dow continues to move toward the 200 day moving average, it is almost there. The NASDAQ is trading backup above the T-line. There is no strong indications of investor sentiment going bearish. Continue to stay predominantly long but still be diligent as far as remaining in bullish or bearish charts that continue to confirm.