Archives for August 2020

There is a very strong compelling indicator using candlestick analysis! A close above or below the T-line. As long as a trend does not close below the T line, the probabilities are extremely strong an uptrend remains in progress. This is a very important trend analysis factor. The Dow opened lower today, after the prospects of profit-taking over the past two weeks. It can be observed that there was weakness in the Dow trend, consolidating back to the T-line. Today’s lower open indicated more profit-taking and the possibility of the markets trading lower. However, the Dow closed above the T line. The NASDAQ, S&P 500, and the transportation index all closed above the T-line. The NASDAQ formed a very strong bullish day, providing additional evidence the uptrend was remaining in progress. This allows the candlestick investor to orient their portfolio positions based upon having much higher probabilities the uptrend of the markets are still in progress.

The ability to assess the overall market trend with much more accuracy using candlestick analysis provides the trading strategy to look for the individual stock charts that are producing the strongest upside potential, candlestick pattern breakouts. This has been illustrated by recommendations over the past few weeks that have performed very well when a breakout has occurred. Today FSLY broke out of a cradle pattern, producing an extremely high probability of much more upside. The same pattern, the cradle pattern, has been exhibited in our recent recommendation on SHLL. Currently, SHLL is in the process of producing a J-hook pattern set up, producing additional evidence a strong bullish trend is in progress. The candlestick investor benefits from knowing what the results should be based upon strong pattern breakouts. This produces the trading platform of having positions in high probability profitable trades. Not only profitable trades, but inordinately strong price moves even in a slow up-trending market.

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Good investing,

The Candlestick Forum team.

When the Dow is trading lower and the NASDAQ is trading higher, it indicates there has not been a change of investor sentiment, merely a shifting of funds from sector to sector. This is producing numerous very strong candlestick price patterns. The fry pan bottom is still a very potent profit potential trade set up. The J-hook patterns are producing very good profitability. Knowing which pattern breakouts are going to produce the biggest price moves creates a huge advantage for the candlestick investor. It allows for the constant cultivation of a trading account to keep the strongest positions in place. The slow steady uptrend of the indexes allow for the strong candlestick patterns to perform without the fear of any selling pressure in the overall market.

There are a number of fry pan bottom breakout potential’s. TMHC, DBI, TCDA and PE are all setting up to be high profit trades upon positive trading tomorrow. AN is a classic pattern that is indicating a new J-hook pattern wave after the fry pan bottom strong price move. The candlestick investor has the benefit of being able to identify where a dramatic price move is about to occur. Because the candlestick signals are created by the accumulative knowledge of everybody buying and selling at a specific support level, charts that are forming bullish signals at major support levels such as the 50 day moving average improve the potential of being in the right trend at the right time, GRAF with a MorningStar signal last week, AUDC bouncing off the 50 day moving average with a MorningStar signal also. Human nature works the same way time after time. Candlestick analysis merely exploits that information.

Chat session tonight at 8 PM ET.

Good investing,

The Candlestick Forum team.

The markets showed some consolidation today but no evidence of any change of investor sentiment. The NASDAQ was trading higher while the Dow was trading lower. This usually indicates the current trend is still in progress, merely sector rotation occurring. Knowing what the overall trend is doing allows candlestick investors to pinpoint the strongest signals and patterns occurring during an uptrend. J-hook patterns should be producing high probability/high-profit potential results over the next few trading days. The T line works as a very effective confirmation indicating a J-hook pattern has supported and now heading back up. The advantage of recognizing and utilizing patterns is that they produce much stronger price moves than merely up-trending stock prices.

PLUG is producing a very strong J-hook pattern set up after yesterday’s Doji/hammer signal, that supported right on the T line. OSTK is also producing a high probability J-hook pattern set up. The J-hook pattern provides opportunities to get into strong up trending stocks at the appropriate time after the J-hook pattern has revealed some consolidation and a new wave of buying is about to occur.GRAF produced a cradle pattern, supporting at the 50-day moving average. The same is being witnessed in AUDC. Recognizing strong reversal signals at a major support level is the advantage that candlestick investors have by knowing what investor sentiment is doing at those levels. This information, a candlestick pattern at a level that everybody else is watching, allows for high-profit high probability trades setups. This is the process for putting the probabilities in your favor.

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Good investing,

The Candlestick Forum team

Today the Dow traded much higher, the NASDAQ traded lower, the S&P 500 traded flat. This provides a very simple trend analysis. There is no major change of investor sentiment, the current trend is continuing. This market scenario merely indicates sector rotation. Fortunately, the candlestick investor can easily scan for which sectors have the biggest upside potential’s during specific market trends. The transportation stocks have been showing good strength, indicated by the transportation index. Having the ability to analyze what investor sentiment is doing in specific stock/sectors allows the candlestick investor to execute trades exactly at the appropriate entry levels. This puts the candlestick investor in positions that are later confirmed by other trading techniques.

Combining the analysis of a pattern setting up, getting ready to confirm based upon individual candlestick signals, produces a double confirmation. EB produced the probabilities of a bullish flutter kicker signal at a breakout level upon a positive open. ADS is getting set up for of forming a bullish Doji sandwich breakout of the 50 day moving average, confirming a fry pan bottom breakout. This information has multiple benefits. It allows for the exact entry of a profitable trade. It implies the trade will be profitable based upon witnessing signals created by human nature. It also allows for participating in price moves that are going to be much stronger than ordinary uptrending price moves during a market uptrend. This is a very simple analytical process. The higher the correct trade ratio for a portfolio, obviously the greater the consistent profitable results. Candlestick signals and patterns indicate a price direction with a high degree of probability. Losing trades are easily identified very quickly, closed out, so those funds can be moved to a better probability trade.

Chat session tonight at 8 PM ET.

Good investing,

The Candlestick Forum team.