and The Candlestick Forum
The market trend analysis remains the same, absolutely sideways. This is a good time of year to enjoy the outside, not wasting a lot of time trying to trade this market. Any existing positions require staying above or below the T line. Continue to have both long and short positions in the portfolio.
Although the Dow is trading higher, a vast majority of individual stock positions are showing profit-taking/selling. The Dow is still trading below the T line. The short positions continue to perform well. The portfolio bias should be to the short side.
Candlestick analysis provides a very powerful indication of the direction of a trend/market. It also provides good evidence of when there is not a trend in progress. Currently, the market indexes are drifting lower, likely the result of the summer doldrums. Investor sentiment and activity is probably going to be more lethargic this summer with numerous investors wanting to get out and about without co-vid restrictions.
This may indicate a lack of bullish sentiment as the candlestick charts are beginning to indicate. This provides a trading environment that would warrant adding short positions to the portfolio. The Dow closed below the T line, the NASDAQ closed below the T line. This produces much greater probabilities that a downtrend is starting. Join us in the chat rooms each day. Many good trades are revealed by candlestick investors that have experience.
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Good investing,
The Candlestick Forum team
Summer indecision! Making trading very difficult. The only underlying factor that is consistent is the indexes continue to trade above the T line. However, this is still making it difficult to trade individual stock trends. The strong signals remain the most reliable trading criteria. A nebulous analysis but that is what the market is given us right now.
August 5th Daily Market Comments
The indecisive nature of the market persists. However, the NASDAQ is producing more definable bullish indications, a fry pan bottom type pattern that supported off the T-line. Down trending stocks are showing strength today and uptrending stocks showing weakness. Note that uptrending stocks that did not show strong selling are showing better strength today i.e. SPLK. Maintain heavier cash position until the market shows more direction.