Archives for January 2019

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.

The markets remain in an indecisive stage, the Dow trading positive, the NASDAQ trading lower. There appears to be numerous stocks consolidating back to support levels, indicating the markets are still in a profit-taking mode. The investment strategy remains the same, stay with bullish patterns that have not negated their signals or patterns. Stay with short positions that have not come back up through the T-line.

Today’s hard selling is still making the T-line a critical indicator. All the indexes are trading lower but currently trading right at the T-line. It will be important to see if the indexes close above the T-line, near the high end of their trading ranges Today. A close near the high end of the trading range and above the T-line would produce more evidence of the slow uptrend continuing, still making the 200 day moving average a likely target. A close near the lower end of Today’s trading range, below the T-line, would imply a pullback to the 50 day moving average to see if it’s going to act as support. A close near the lower end of the trading range would also add more evidence the uptrend was currently running out of steam based upon the past two weeks showing a lack of bullish sentiment. Be ready to take some profits if the indexes close below the T-line Today. There are numerous stocks that although are trading lower, are trading above where they opened, indicating the lack of aggressive selling so far Today.

Today’s positive trading is creating J-hook patterns in the indexes as well as numerous individual stock prices. The J-hook pattern indicates the consolidation is over, with the expectation of more upside/wave three. Continue to stay predominantly long, short positions that are not continuing to show weakness should be covered. The T-line in the indexes reveal the lack of any bearish sentiment. The 200 day moving average is a likely target for the Dow and the S&P 500. Utilize J-hook pattern trades.

The negative political environment in Washington is being offset by positive earnings. This is creating a lack of direction of the markets. However, the lack of any evidence of selling pressure is allowing bullish and bearish candlestick chart patterns to work very effectively. These market conditions make utilizing the T-line, after either a bullish or bearish reversal signal, very effective. It is not unusual on a day like Today to see a majority of the bullish positions trading bullish and a majority of the bearish positions continuing lower. This is due to merely analyzing what the charts are indicating about investor sentiment.

Although the market indexes are trading higher Today, they are currently trading below where they opened. This indicates the bullish trading Today may not be as vibrant as expected. Be careful of any bullish purchases Today. For the markets to show any real strength, Today’s trading needs to close near the high end of the trading range. A close below Today’s open, although positive, will not show any major trend movements. The T-line remains an important trend indicator. Flat trading from this area still allow for strong candlestick signals and patterns to perform.

The gap up in the NASDAQ and the S&P 500 on Friday, in the overbought condition, was a mild alert to start looking for possible profit-taking. If the markets close lower Today, a consolidation back to the 50 day moving average/T-line would be viable

A good bullish day? Be careful, today the indexes gapped up in the overbought condition. It would not be unusual to see profit-taking start coming in before the end of the day, before a long weekend. And the prospect of the indexes, after coming up through the 50 day moving average resistance level, pulling back to see if the resistance level is now going to act as support. Stay predominantly long. Any selling in the market would make for more diligent evaluation of long positions, making sure reversal signals were not occurring.

The lack of any selling pressure is still evident in the market indexes, especially in the NASDAQ that is continuing to show strength above the 50 day moving average. This is allowing numerous J-hook patterns and frypan bottom patterns to be working very well. Continue to hold long positions and you can be establishing bullish positions in some of the J-hook patterns.