Archives for July 2019

What does identifying candlestick reversal signals at important technical levels do for an investor? It allows for entering trades at the appropriate confirmation levels, which is usually well I had of other investors. This became clearly evident when analyzing the Dow during this past week of trading. Bullish signals occurring at the T line made much more clear the uptrend was remaining in progress. This instant visual analysis allows the candlestick investor to enter bullish trades more aggressively knowing that the overall trend of the market remains bullish. This results in bigger potential profits but more importantly allows for entering trades during the early part of a new trend movement, which creates the trading environment for closing out losing that didn’t perform with much smaller losses. This greatly enhances the trading strategy of cutting your losses short and let your profits run.

When there is not the fear of any great bearish investor sentiment in the markets, candlestick bullish patterns perform much more profitably. Because prices move based upon investor sentiment versus fundamental reasons, a market atmosphere that does not have the dampening a fact of possible selling produces much bigger gains in candlestick pattern breakouts. Frypan bottom breakout’s have created big gains in our recommendations on STNE and ANGO this week. The bobble breakout has also been very effective, i.e. MDR and YETI. The probability factor of being in the correct trade at the correct time is dramatically enhanced when utilizing the movements of reoccurring human nature. The visual aspects of candlestick analysis clearly illustrate when a bullish pattern is in progress or when a prospective bullish trade does not perform, it allows for closing that position and moving on to a position that has better probabilities.

We will conduct a “Members Only” chat session tonight at 8:00 pm EST.

Good Investing,

The Candlestick Forum Team

The summer doldrums! Makes trading much more difficult. However, a huge advantage for utilizing candlestick scanning becomes much more apparent. The simplicity of the visual analysis for strong candlestick signals and patterns enhances the ability to find good trades even when the overall market becomes lethargic. ROKU was recommended today because of the bullish Doji sandwich that broke through the T line on Friday. The results of a Doji sandwich creates a high probability trades set up. QD was recommended based upon the same pattern identification. Most investors overcomplicate trade set up analysis. Candlestick analysis remains very simple. Candlestick signals and patterns are going to produce high probability results because human nature works the same way time after time. The probabilities of being in a correct trade is merely incorporating visual signals and patterns with other visibly recognizable indicators. A candlestick buy signal coming back up through the T line or the 50 day moving average merely reveals that a buy signal is breaching a level that most other investors are watching. The buy signal allows the candlestick investor to be positioned before everybody else starts buying into a position based upon other indicators.

AMZN is a good example of a bullish candlestick signal showing the probabilities of a breakout through a resistance level. A bullish flutter kicker signal indicates a frypan bottom pattern breakout through a perceivable resistance level. This is called convergence analysis or 2+2, simply adding multiple signals and patterns at breakout levels that dramatically improve the probabilities of knowing when to get into a bullish or bearish position. We often state that this is not rocket science, this is merely learning what human nature normally does based upon the signals that have been identified through hundreds of years of analysis.

We will conduct a “Members Only” chat session tonight at 8:00 pm EST.

Good Investing,

The Candlestick Forum Team