Archives for October 2019

The markets are in a wait and see mode, waiting for the Fed announcements. However, the markets are not demonstrating any change of investor sentiment, continuing the uptrend. There are a small number of talking heads still warning of a market selloff the same as 2008. This is very bullish. Take advantage of the signals and patterns that are working. The frypan bottom pattern is producing great results, i.e. UIS, CVLT. ROKU is in the process of developing a Doji sandwich breakout.

Today’s early trading reveals consolidation. Why is this anticipated as consolidation versus a reversal? The Dow and S&P 500 are trading slightly positive while the NASDAQ is trading lower. Numerous individual stock charts, although trading slightly lower, are trading indecisively, Doji type formations. This illustrates that although there is some selling, it is not with any great urgency. Continue to stay predominantly long. Today may not be a riproaring day but it is still maintaining the upward trend of the markets, staying above the T-line.

The patterns contribute tremendously when analyzing the overall market trend. The NASDAQ is doing a J-hook pattern up through the breakout level of the wedge. The S&P 500 has gapped up through the all-time high resistance level and continuing to trade higher. The Dow is forming a J-hook pattern implying it is heading to the upper resistance level. The 2+2 analysis clearly indicates continued bullish sentiment based upon candlestick patterns at obvious breakout levels. Until there is a definite candlestick reversal signal, stay predominantly long. Knowing what a candlestick pattern illustrates and witnessing that pattern occurring at levels that everybody else’s watching allows the candlestick investor to execute positions with much more aggressiveness. The NASDAQ demonstrated a J-hook pattern confirmation as it was going through an upper resistance level. The S&P 500 gapped up through the all-time high breakout level. The graphics of candlestick signals and patterns merely illustrate the logic built into investor sentiment. When prices/trends gap up through an obvious resistance level, it merely indicates that investor sentiment did not have any concern about those resistance levels, implying price movement moving much higher.

The information built into candlestick patterns and signals allow for an extremely high probability analysis of a price move as well as the identification of a high profit price move. Witnessing candlestick signals in the development of a candlestick pattern dramatically improves the probabilities of participating in a high profit move. Candlestick analysis has the benefit of anticipating the results of investor sentiment that has performed the same way time after time for the past 400 years. Profiting from candlestick patterns is merely identifying high profit results of human nature. For example, witnessing a belt hold signal as a frypan bottom pattern is developing as illustrated in our recommendation of GOSS, dramatically improves the probabilities of profiting from that pattern. This is merely applying the probabilities of being in the correct direction of profitable trades a high percentage of the time.

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

Good Investing,

The Candlestick Forum Team

The patterns contribute tremendously when analyzing the overall market trend. The NASDAQ is doing a J-hook pattern up through the breakout level of the wedge. The S&P 500 has gapped up through the all-time high resistance level and continuing to trade higher. The Dow is forming a J-hook pattern implying it is heading to the upper resistance level.

Today’s positive trading indicates the T-line is still acting as a bullish support level for the Dow. However more important, the NASDAQ is currently forming a bullish left/right combo right at the upper resistance level, producing the prospects of a bullish J-hook pattern breakout. This is a strong indication of the markets starting to move into new high territory. Stay predominantly long, any short positions require very compelling bearish charts to stay short. As long as the indexes continue to trade above the T-line, bullish sentiment is still the underlying factor in this market.

The characteristics of a market trend are much more easily anticipated when analyzing what each individual daily formation represents. The Dow has been trading indecisively and in a sideways direction for the past two weeks. This was further confirming the wedge formation of the overall markets. Until there is strong evidence, either bullish or bearish, it can be easily evaluated that there is no direction in this current market. This continues to make each individual stock/sector the top priority as far as analyzing where the bullish or bearish pressures appear. Candlestick signals, patterns, and the T-line make for the high probability price movement analysis. The steady Eddie positions continue to move in the correct direction as long as they stay above the T-line.

Numerous frypan bottom patterns are working well Today, in a market that is not demonstrating any dramatic force one way or the other after the open. This also correlates with the lack of direction of the overall market trend still in a sideways wedge formation. Stay with the sectors that are acting strong, i.e. shipping stocks. Stay with positions that remain above the T-line.