Archives for August 2019

The visual results of candlestick charts produce beneficial trade executions. This is due to to the expectation of what a price move should do with a high degree of probability after the appearance of a candlestick signal. The indexes produced MorningStar signals on Friday, positive trading after a Doji in the oversold areas. The Dow produce greater expectations when the MorningStar signal occurred right off the 200 day moving average. Knowing what to expect, based upon a candlestick reversal signal and its location in the oversold area, allows candlestick investors to move aggressively when the signals confirm. This produces the ability to move quickly based upon knowing what to expect as far as confirmation of a reversal signal. Witnessing the premarket futures showing a positive open today after the MorningStar signals in the indexes on Friday had the candlestick investor prepared to buy individual stock positions that were showing strong bullish confirmation immediately on the open.

Expecting confirmation of the indexes allows for taking advantage of chart patterns that are going to be confirming based upon the lack of any major change in the overall market indexes. Today ,NVDA gapped up on the open. Most investors are usually hesitant about buying into excessive price moves. However, knowing that a positive open would have created a bullish flutter kicker allows for very profitable trades by moving immediately on the confirmation of that signal set up. The same high probability analysis was applied to MU. When it opened positive, it not only was confirming the MorningStar signal off the T line, it was also demonstrating a J-hook pattern set up potential. This is what is considered 2 plus 2 analysis, witnessing what the individual signals are doing that are going to confirm a high profit pattern. This is not rocket science, this is merely identifying the same patterns that human nature provides century after century. Candlestick analysis is merely learning to identify what same human nature patterns will be forming. Because human nature works the same way time after time, candlestick analysis constantly puts investors in high probability trades set ups.

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Good Investing,

The Candlestick Forum Team

The market had remain in a very indecisive mode due mainly to tweets and interest rate expectations. But fortunately for candlestick investors there is still very simple trend criteria that allow to make a trend assessment. As witnessed in the Dow, after the bearish left right combo at the T-line, the market started showing support with bullish candlestick signals at the 200 day moving average. A reversal or a bounce? That was easily identified when the indexes could not reach the T-line. This provided the expectation that the Bulls had not yet taken control. As seen over the past seven trading days, there was no continuity in a trend, daily oscillations. But the most revealing criteria remained that the markets could not show a bullish reversal signal and a close above the T line. Although the downtrend seems to be prevalent, the formation of of a bearish J-hook pattern, the Dow is currently trading at the 200 day moving average, a possible support level. It will be important to see how they open the markets tomorrow, revealing the 200 day moving average is going to act as support on a positive open or whether a bearish Doji sandwich demonstrates more downside on a lower open. The advantage of candlestick analysis is knowing what type of signals and patterns will be formed based upon the results of individual signals.

With the market moving dramatically up one day and down the next day, it is obviously very difficult to trade. That provides two obvious trading strategies. First, if the market and individual stock price movement is not showing any consistent direction, there are times when it is much better to sit in cash until a direction can be identified. Or secondly, any positions should have very relevant pattern confirmations to offset the effect of outside influences. Pattern breakouts or very powerful candlestick signals as revealed in TSLA and TLRY provide higher probability price moves that will overcome an oscillating general market.TLRY short recommendation was based upon a very strong bearish kicker signal. TSLA short recommendation was based upon a wedge breakout to the downside. The information built into candlestick signals allow the candlestick investor to take advantage of the most powerful trend movements.

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Good Investing,

The Candlestick Forum Team