Archives for August 2020

The Dow traded lower while the NASDAQ traded higher, indicating there was no major change of investor sentiment in the current market trend. This merely indicates rotation of sectors. Gold has started to trade higher again, making the gold stocks a viable sector. LABU is a good indicator to illustrate the biotech sector is starting to show strength. The major advantage of candlestick analysis is allowing an investor to identify where bullish funds are moving to. Having this information dramatically improves the probability of having trades applied to the stock/sectors that will have better bullish results. Adding the analytical factor of candlestick signals and patterns to individual stock charts increases profitability when trading the candlestick patterns that are starting to breakout. This is not a difficult process. The high probability signals and patterns are easily identified.

The frypan bottom pattern is working exceptionally well during this uptrend. New fry pan bottom setups are identified in MCRB and TUP. NIO is currently benefiting from the frypan bottom trajectory. There is a very simple trading rule when entering a frypan bottom pattern. You can stay long as long as the trend continues to trade above the T line. Last week, numerous J-hook patterns are performing very well. Our recommendation tomorrow on TRIL will be based upon wave three of a J-hook pattern confirmed today. Recognizing when a pattern breakout is about to occur provides the optimal entry point, whether buying stock or options. This produces a trading platform that minimizes having to sit in a trade waiting for it to perform. A pattern breakout is the exact point for entering a trade knowing that it is going to perform well right at that time.

Chat session tonight at 8 PM ET.

Good investing,

The Candlestick Forum team.

The candlestick investor has a comforting benefit when putting on a trade, using candlestick signals. The probability of a profitable trade is greatly in their favor. Probabilities! That is an important definition. Candlestick signals and patterns produce high probability results based on hundreds of years of historical results. Not only are the probabilities of being in a correct direction, but the magnitude of the strong signals and patterns produce much greater profitability than merely up trending stocks during an up-trending market. Common sense logic produces a profitable trading strategy for candlestick investors. The signals and patterns show when a high probability trades set up is in progress and the signals and patterns also can be visually analyzed to see when that signal or pattern is not producing. This allows for the proverbial cutting your losses short and letting your profits run.

Convergence analysis is the accumulation of multiple buy formations, adding credibility to a buying decision. This is illustrated in today’s trading of MDT. A gap up through the 200 day moving average produced a message signal. The gap up through the 200 day moving average also produced a bobble breakout. Yesterday’s trading illustrated the previous day’s message, profit-taking was over. Today’s positive trading illustrated the strength created by the message signal was continuing. Add the fact that MDT broke out through the 200 day moving average also confirmed a breakout of a large fry pan bottom pattern. A steady market trend, not producing any sell indications, produces the environment that allows investor sentiment to enhance the bullish pattern breakouts.

Chat session tonight at 8 PM ET with Guest Speaker Jeff Tompkins. Click here to register.

Good investing,

The Candlestick Forum team

The up-trending market remains obvious. The indexes consistently trade above the T-line. The Dow has actually formed a J-hook pattern set up off the T-line. This implies wave three is about ready to start, more upside is expected. The advantage of being able to analyze the overall market trend with a high degree of accuracy allows the candlestick investor to pinpoint which stock charts are producing the strongest pattern setups. Currently, J-hook patterns are producing very strong upside potential. The cradle pattern that formed in SHLL produced an uptrend that incorporated a J-hook pattern. Today’s strong move in SHLL today has used those patterns to produce a big frypan bottom breakout pattern. The candlestick investor gains a huge advantage by being able to recognize the reoccurring price moves that are created over and over by human nature. The probabilities of being in the right place at the right time are dramatically improved utilizing candlestick patterns.

TWLO gapped up today, producing a frypan bottom breakout. Many stock prices will move up during an up-trending market. Many will not! But utilizing the information built into pattern setups allows investors not only to be in a bullish move, but participating in bullish moves that will be much stronger than mere up trending stocks in an up trending market. TWLO can be bought on positive trading tomorrow, indicating a frypan bottom breakout. Big profits can be made in both buying the stocks and/or having the optimal entry points for strong moves for option trades.

Chat session tonight at 8 PM ET.

Good investing,

The Candlestick Forum team.