and The Candlestick Forum
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Stock Chat – Thursday 11/19/20
At the end of the webinar, Steve announced his upcoming “Candlestick Convergence Analysis ” event, which he’ll present on Saturday, November 21st.
This 4-hour training workshop will provide you with visual perspectives that will improve your investing for the rest of your life.
Click here for more information.
After the bearish left/right combo formed in the indexes over the past few days, today’s trading initially traded lower as expected. However, the next assessment is very easy for the candlestick investor. What were the indexes doing when it reached the T line? As demonstrated, the indexes traded lower than closed above the T line. This makes the probabilities extremely strong the market trend is still in an uptrend as long as the indexes close above the T line. The NASDAQ produces a much more clear trend indication, opening at the T line and trading positive on the day, forming a bullish engulfing signal right at the downtrending resistance level. A positive open tomorrow in the NASDAQ will create a very bullish confirmation. Although the market indexes are in a slow uptrend, they are still in a very choppy mode. Fortunately, convergence analysis makes the probabilities of consistently producing profitable trades very easy. Convergence analysis is merely the visual process of recognizing multiple confirmation indicators in conjunction with a candlestick reversal signal or pattern breakout. The more indicators that can be visually recognize with an instantaneous glance, the higher the probability a price move is likely to occur.
The electric vehicle sector and the lithium mining sector have produced excessively large profits over the past five trading days, BLNK and KNDI have doubled in price during that time. Participating in these price moves are greatly enhanced when the candlestick investor can visually recognize more than one confirming indicator that is likely to produce an uptrend and a very strong uptrend. The logic built into candlestick analysis provides an extremely high probability result. This allows the candlestick investor to consistently put on trades that have much greater probabilities of producing profits on a consistent basis. Join us this Saturday, November 21 for a full day training on utilizing all the information built into candlestick signals and patterns that are enhanced by multiple confirming indicators. This type of visual analysis is what can dramatically improve your profitability and consistent profitability.
Chat session tonight at 8 PM ET. Click here to register.
Good investing,
The Candlestick Forum team.
Although the market indexes are still in an indecisive mode, they aren’t selling off. The prognosis remains the same, specific sectors are acting well, electric vehicles, the oil sector. There continues to be a good supply of bullish charts as well as bearish charts. Maintain or add positions that have very compelling signals or patterns. Stay predominately long as long as the indexes continue to trade above the T-line.
The market indexes remain above the T-line, implying the uptrend remains in progress. However, the nature of the uptrend remains the same as the nature of the market for the past few weeks, very choppy. The electric vehicle sector remain strong. Lithium mining stocks are still in an uptrend but experiencing profit-taking today. Although the Dow has sold off today, the NASDAQ is holding up well, another indication today is merely some profit-taking. Crude oil remains around the $41 level. Crude oil stocks have backed off but are still in an uptrend. Stay predominately long.
What is a major advantage of candlestick investing over most investors trading? Most investors have mediocre returns because even during a strong uptrend, they will hold positions that are not working or even trading lower. Candlestick investors circumvent that mediocrity. Simple scanning techniques allow for identifying which sectors are the strongest and which sectors are not working. This produces the trading strategy for investors to quickly close out trades that are not working and moving to sectors that are showing the best strength. This produces much better returns because all the trades should be moving in the right direction. Currently, electric vehicles, lithium mining, and the oil sector are acting the strongest. Having the portfolio oriented toward the strong sectors during a market uptrend dramatically enhances the profitability of the portfolio.
Lithium mining stocks such as WWR, LTHM and PLL are producing strong returns. There will always be uptrending stock prices in an uptrending market, but the strongest profits come from identifying candlestick reversal signals and patterns that produce much better probabilities of profitable trades. The bobble breakout is a very powerful bullish price pattern set up. The shipping stocks, STNG, FRO, and TNK are all showing bobble breakout potential. Oil stocks have shown support and breakouts at the 50 day moving average making the 200 day moving average likely targets. Taking advantage of the information that is built into candlestick analysis allows an investor to take the guesswork out of which stocks/sectors will work the best. Having the majority of the portfolio positions in the sectors during an uptrend dramatically reduces the potential of mediocrity returns. The more pieces of evidence you can put into your analysis, the better the probabilities of being in a correct trade. Join us this Saturday for a a candlestick training on Convergence Analysis, identifying multiple confirming indicators that dramatically improve the probability of being in the correct trade at the correct time.
Chat session tonight at 8 PM ET, identifying the best sectors.
Good investing,
The Candlestick Forum team
The vaccine rally! Today’s gap up in the Dow gapped up through the all-time high and trading above that level. The S&P 500 also trading in all time high territory. The prospects of a second vaccine with extremely high favorable results makes the future obviously looked better. The stay at home stocks are selling off and the getting out stocks showing good strength. The indecisiveness of the indexes are becoming less indecisive based upon announcements about the vaccine. Continue to be stock/sector specific but biased toward the upside. Currently, there are no signs of bearish investor sentiment.
No direction! The markets are having a hard time finding a direction. Up one day down the next day. Be careful of today’s bullish bounce. The same is occurring in individual stock prices up one day down the next day making trading very difficult. When trading becomes difficult, sit back in cash until there is more decisive price movements. Although strong signals and patterns are less plentiful in these market conditions, there are still good trades set ups available.
The bearish left/right combo in the NASDAQ is still the relevant sell signal. The Dow has shown selling after the gap up Shooting Star type signal failed at the recent all-time high in the Dow index. The current selling is likely to bring the Dow back down to test the T-line, after moving up excessively away from the T line. This would imply having short positions in the portfolio. At this point, any long positions should have been closed out if they were showing sell signals and signs of weakness, closing below the T line. This shows the relevance of the Japanese rice traders saying “Let the market tell you what the market is doing.” The market does not like indecision. The current political atmosphere and the increase in the virus cases is producing an indecisive outlook for investors.
There still remain some good long positions as long as they stay above the T line. Simple candlestick scanning techniques also identifies good short positions, as in our recommendations to short RUN and CYH. Candlestick charts also reveal when there is not any clear analysis on a charts movement. This is demonstrated by the big traders, AMZN, NVDA, NFLX, TSLA, not showing any decisive trend movement. Simple candlestick logic implies you do not trade these stocks until there is better definable trend movements. The candlestick charts tell you when to buy, when to sell, and when to stay out of a trade. The more visual evidence that you can apply to candlestick signals and patterns, what we call convergence analysis, the higher the probability the trend will perform. Join us on November 21 for a full-day of training on how to utilize convergence analysis to dramatically improve the probabilities of being in the correct trades at the correct time.
Chat session tonight at 8 PM ET.
Good investing,
The Candlestick Forum team.
The Dow trading lower, the NASDAQ trading higher. This makes the analysis of each individual stock chart the top priority. And enhancing the importance of entering any new trades based upon expected confirmation. These market conditions demonstrate numerous bullish entry potentials opening lower, or bearish potential trades opening positive, not confirming. When the market is not illustrating a definite confirms direction, entering any trades should be done with compelling signals and the appropriate confirmation. The maintenance of existing positions remains the same, use the T line as your trend confirmation.
November 19th Daily Market Comments
Yesterday, the market indexes did bearish left/right combos in the overbought area producing Today’s expected profit-taking/selling. Now the T-line becomes an important factor. The indexes need to use the T-line as support or continue to trade above the T-line. Be prepared to close out long positions that are showing weakness if the T line does not confirm as a support level. The electric vehicle and lithium mining stocks continue to show good strength. Maintaining long positions requires very strong/compelling bullish charts, staying above the T line.