Archives for June 2023

Identifying breakouts becomes relatively easy when using candlestick signals with breakout levels. Identifying breakouts is merely witnessing a strong candlestick signal that takes prices up through a resistance level everybody else is watching. For a trader, identifying breakouts provides trade setups that are going to move prices exuberantly fast, versus waiting for a price to move up if the market moves up. Currently, the indexes are showing J-hook patterns which would imply more upside. However, aggressive buying tomorrow is not prudent based on a long holiday weekend coming up. This does not deter from buying strong breakout signals. Still, statistically, when the market moves positively going into a long weekend, the reverse trading action will occur after a long weekend. These type of trading truisms can be much more easily confirmed using the graphics of candlestick signals.

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Stephen Bigalow

Pattern breakouts, which are easily identified using candlestick analysis, provide two significant features. First, they produce high probability trend expectations. Secondly, the new price move is usually going to be inordinately strong. Another significant aspect is that candlestick patterns will continue to move in the direction of the pattern expectation in spite of the overall market direction. They are enhanced when moving in the same direction as the overall market. Currently, the market indexes are showing weakness/bearishness, with all the indexes trading below the T-line except for the transportation index. This continues to make the T-line the most critical trend indicator. Once you identify the strong candlestick signals and patterns, you gain a massive advantage of knowing what’s occurring in investor sentiment. The market indexes are revealing bearish sentiment making scanning for short positions a higher priority.

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Stephen Bigalow

Identifying breakouts allows candlestick investors to be in positions where there is new positive bullish sentiment coming into a price move. Identifying breakouts allows the aggressive trader to be in positions where the activity is going to be highly profitable based upon identifying the price move with candlestick analysis. A big breakout move instigates the RARE process, research analysis reverse engineering, meaning immediately go and see what the news was that created this new interest. The common sense aspects of candlestick analysis provides highly profitable/active trades. Instead of waiting for price moves that may eventually occur, candlestick signals and patterns identify immediately when strong bullish or bearish interest has entered a stock trade. Once a breakout has been identified, maintaining that position remains simple by using the T line. Everything built into candlestick analysis is merely common sense put into a graphic depiction.

Chat session tonight at 8 PM ET. Click here to register.

Good Investing,

Stephen Bigalow

Sector trading is the relevant trading strategy in these market conditions. Sector trading emphasizes specific sectors that are moving with much greater strength, either in a bullish trend or a bearish trend, when the market conditions start showing indecisive movement. The artificial intelligence sector has been in the limelight for the last few months. Candlestick scanning identifies which stocks are moving the strongest in an industry everybody is touting. As illustrated in today’s trading, SOUN broke out through a resistance level and had the prospect of heading much higher. CXAI performed a solid bullish candle off the T line following a slow curve setup. Recognizing the candlestick signals and patterns in a strong sector pinpoint which stocks have the best prospects. Good money management also dictates having both long and short positions in the portfolio when the market indexes are at levels that show indecisiveness, the prospect of moving in either direction. The primary benefit of candlestick signals and patterns is establishing trades, for the probabilities are significantly in your favor.

Members Chat session tonight at 7pm central. Free to Members. Not a member? Click here to join

Good Investing,

Stephen Bigalow