Investor sentiment indicated that it had changed with a strong sell signal in the NASDAQ, a bearish Doji sandwich, and a close back below the T line. This occurred when the other indexes also sold off. The Dow and the S&P 500 closed back down right on the T line. This will make it very important to see what the premarket futures are indicating tomorrow. Keep in mind, the probabilities become extremely strong that a downtrend will be in progress after witnessing a candlestick sell signal and a close below the T line. A weaker open, in the premarket futures tomorrow, would confirm the selling is continuing. Having the ability to accurately assess the direction of the market allows an investor to scan for the appropriate trade setups, either long or short.

A major advantage of candlestick signals and patterns in their development based upon the accumulation of human nature. As demonstrated in a number of our recent recommendations, observable patterns continue to provide relatively strong bullish moves in spite of the major weakness of the market. The advantage of participating in what we call the Top Ranked signals and patterns is threefold. First, it creates an extremely high probability of being in the right direction. Secondly, the magnitude of the move is going to be much greater than mere up trending stocks during an uptrend. And finally, because of the strength of the price move created by bullish sentiment, the price movement of an individual stock will likely continue its uptrend or at least remain flat when the overall market has turned in the other direction, giving more time to get out of a trade profitably. Join us this weekend, Saturday, July 25, for a full day training on recognizing and implementing the Top Ranked candlestick signals and patterns. If you are going to spend the time and energy to locate good trades setups, you should maximize your efforts by learning which of the top-ranked signals and patterns will work the best for your trading. You will not be disappointed! You will gain some very valuable insights as to which price moves are going to produce the strongest potential moves and learn when the exact optimal entry point presents itself. Click here for more info.

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The candlestick powers signals produce big profits when the market condition is a slow up steady move. The strength of these signals is based upon the information built into candlestick signal formations that illustrate what is occurring in investor sentiment. The Japanese rice traders have illustrated the patterns and signals that reoccur in human nature. The combination of signals and patterns produce a category, the Top Ranked candlestick signals and patterns. This is merely the combination of candlestick signals in conjunction with price patterns that produce inordinately strong price moves. Additionally, the probabilities of those price moves occurring are extremely strong. This allows the candlestick investor to be in the best trades when the overall market is producing a trading environment that shows the lack of any selling sentiment. Join us this Saturday for a full day training on the candlestick Top Ranked signals and patterns. This will allow you to pinpoint the best trades to be in during a market trend.

The biotech’s and the gold stocks continue to work very well. Crude oil prices have maintained, allowing oil stocks to show good upside potential. There are numerous J-hook patterns in progress. Take advantage of the information built into the J-hook pattern, allowing you to calculate what wave three will produce as far as percentage return. ALT is at the beginning of a wave three of a J-hook pattern. The Biotech stocks will remain strong as long as the China virus remains in the headlines. These are market conditions that will allow for exceptional profits, 10%, 20%, 30% and greater are being produced with investor confidence remaining in the markets.

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The Candlestick Forum team.

Although the indexes pulled back Today, they produced indecisive candlestick formations, a Doji type day. Each of the indexes has created the double Doji setup. This is consolidation but indecisive selling, usually implying profit-taking. The double Doji set up allows investors to enter trades immediately upon a positive open, showing that the consolidation is over. A positive open will usually produce a candle formation of the same magnitude as the candle prior to the double Doji’s. A positive open tomorrow, even though NFLX missed their earnings, would indicate the T-line is still acting as a strong support level.

Although the market indexes have been choppy in the slow uptrend, simple candlestick scanning techniques have revealed the strong sectors. The Biotech and medical supply companies have been acting extremely well based upon the virus situation. Crude oil prices have maintained at the $40 level. This is produced some good strong bullish charts, such as MTDR, HAL and APA. Gold stocks have acted well also. Having the ability to identify the very strong bullish candlestick reversal signals has two major benefits. It shows which stock/sectors are going to move positive and inordinate strength that will be exhibited in those sectors. The strength of a Top Ranked signal or pattern is likely to maintain strength even during bearish short-term moves in the indexes.

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Today’s reversal in the market was expected. Candlestick analysis has a very simple indicator based upon the Japanese rice traders. If you see a gap up in the overbought conditions, start watching for selling. Today the NASDAQ gapped up and traded higher. The logical stop for candlestick investors is the open. Logic dictates that if the prices come back down through the gap up open, profit-taking is in progress. This was also illustrated in the big stocks, AMZN, NFLX, AAPL, TSLA, gapping up in the overbought conditions illustrated the enthusiastic buyers at the top. Today’s gap up in the market indexes was a good alert to take profits in positions that were showing excessive strength in the overbought area.

However, big profits can still be made by identifying the strong signals and patterns. The Biotech’s have been producing excellent profits over the past week. ALT has moved up nicely and showed a profit-taking sell signal in today’s trading. VXRT was identified early in today’s trading based upon the best friend gap up off the T-line, creating a methods rising signal as well as setting up a J-Hook pattern. Knowing what human nature does time after time allows the candlestick investor to take advantage of the potential big-price moves.

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The Candlestick Forum team.

Today’s weakness in the Dow reveals the sideways mode of the market after it resisted at the 200-day moving average. However, the NASDAQ continues to trade higher. This combination indicates there is no major change of the overall market trend, merely shifting of funds from sectors to sectors. Big profits are being made utilizing the pattern breakouts. The slow curve breakout of ALT produced a 52% gain in the stock and with much greater returns in the calls. This is not to brag about being in a big price move trade, it is basically illustrating how utilizing the information built into candlestick patterns allows investors to be in the correct trade right at the ultimate entry points.

Utilizing the patterns provided by candlestick charts allows an investor to identify the exact time to get into a trade, not having to wait around to see if that trade was going to work or not. Identifying the breakouts instigates adding a position right at the appropriate time. Numerous stocks have broken out of patterns this past week, producing excellent profitable trades. Adding the T-line as an indicator creates a trading strategy that takes the emotions out of when to close out a trade. A bullish price move can be maintained as long as there is not a close back below the T-line. These market conditions enhance the prospects of big bullish price moves when there is a lack of concern of bearish sentiment possibly reversing the markets. Currently, with the market trend more of a sideways mode, identifying bullish candlestick pattern breakouts are further enhanced.

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With the market indexes continuing to trade positive, it confirms the uptrend remains in progress as long as the indexes continue to trade above the T-line. The strongest index was the NASDAQ. It actually gapped up and opened at a resistance level and traded positive from there. Economic indicators, such as the manufacturing index was up strong from May to June. This information appears to be overriding the increase in Corona virus numbers. Let the market tell you what the market is doing, the Japanese rice traders professing. We may not know what is producing the bullish sentiment, but candlestick investors do not need to know. Candlestick investors have the benefit of visually analyzing what everybody else’s decision is doing to the market trends. Currently there does not appear to be any exuberant buying in the market. However, TSLA and AMZN have been producing huge profits and are showing signs of exuberance. Be ready to take profits in price moves that are moving too far too fast.

J-hook patterns have produced significant profits. NIO and NIU J-hook patterns produce the prospects of much more upside. The candlestick patterns have produced consistent profits even as the market indexes oscillate. Pattern breakouts are indicating which sectors are now showing new strength. The chemical companies are showing good pattern breakouts ie SQM. CZZ has a very strong chart, showing a kicker signal breakout of a fry pan bottom through the 200 day moving average. This is what we call convergence analysis or 2+2 analysis, the more factors you can put into a visual analysis showing improved probabilities with multiple bullish indications merely improves the probabilities of not only being in a correct trade at the correct time, but a very strong price move.

Chat session tonight at 8 PM ET.

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The Candlestick Forum team.

Good employment numbers, bad virus numbers, why is the market going up? We do not need to have that ability to figure out why the market is going up. Candlestick analysis merely evaluates what everybody decisions are for either buying or selling. Investing is a forward-looking process. The graphics of the candlestick charts merely reveal that investor sentiment is being influenced by what investors are anticipating for the future. Today’s events and/or facts have been built into the market. Investor decisions are based upon what the expectations are for economic future results. Currently, the market indexes are continuing to trade above the T line. Historic probability-factors indicate that as long prices/indexes trade above the T line, the probabilities are extremely strong the uptrend remains in progress.

Having the ability to analyze the overall market trend allows the candlestick investor to take advantage of potentially strong pattern breakout price moves. The magnitude of these moves are enhanced when knowing the overall market trend is moving in the same direction. Common sense dictates bullish charts are going to have greater bullish strength when the overall market is trading positive. Bearish candlestick price patterns are going to act with more force to the downside when the market, in general, is heading to the downside. This may seem like oversimplified logic, but a major benefit of candlestick analysis is the fact that the chart patterns are created by common sense aspects of what human nature normally does. Currently, J-hook patterns and fry pan bottom patterns continue to work exceptionally well in these market conditions. Our recommendations of APPS, VIVO, ZM and numerous Steady Eddie trending stocks continue to produce good profitability because of a simple trend indicator, they are remaining above the T line.

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The Candlestick Forum team.

The major indexes formed bullish Harami’s Today, a very strong candlestick signal indicating the selling has stopped. However, all the indexes are still trading below the T-line. This allows for the candlestick investor to be prepared for the next trend movement. A failure of the bullish Harami, a lower open tomorrow, would continue to make the T line downtrend the viable analysis. A positive open tomorrow, confirming the bullish Harami, would add credence to the Dow supporting at the 50-day moving average and the NASDAQ supporting at the up-trending channel. Knowing what to expect, based upon how the markets open, allows for increasing or closing long and short positions in the portfolio.

Currently there are sectors that are producing good strong steady profits. Gold stocks, for example, are gaining strength because gold prices continue to slowly move positive. Having the ability to analyze the overall market trend, analyzing individual sectors, and then able to analyze which stocks are producing the strongest signals in that sector allows the candlestick investor to dramatically improve the probabilities of being in the correct trade at the correct time, putting all the stars in alignment. Knowing which candlestick signals and patterns produce the strongest results also increases the probabilities of being in profitable trades at the optimal entry points.

Chat session tonight at 8 PM ET.

Good investing,

The Candlestick Forum team.

Candlestick signals are created as a graphic depiction of what is occurring in investor sentiment. Candlestick patterns are the accumulation of investor sentiment illustrated in a recognized pattern that is reoccurring time after time. A major benefit of candlestick patterns is that it keeps an investor from getting whipsawed during oscillating markets. The frypan bottom patterns have produced inordinately strong and consistent profits. As witnessed, numerous fry pan bottom patterns continue to trade higher or flat even in a market that had sold off over 700 points. This is because investor sentiment was building up for other reasons in purchasing those positions, which was not concerned about the general market direction.

The Best Friend signal illustrates a new and powerful interest in a price move. This is illustrated from the Best Friend signal recommendation last week in ALT. Today it continued its uptrend based upon news that somebody had accumulated 20% of their stock. After a strong price move into the close today, the announcement has caused more buying in after-hours, up another 15 to 20%. This is not to illustrate great stock-picking ability, this is to demonstrate that the signals will illustrate when something very bullish is occurring in a price move. We may not know what is causing it, all we can analyze with candlestick analysis is that there is strong bullish activity. These are the positions we want to be participating in.

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The Candlestick Forum team.

The markets are moving in a manner that makes it very profitable trading candlestick patterns. The Dow and the S&P 500 are trading relatively flat. But the NASDAQ continues to trade above the T line, revealing a J-hook pattern in progress. This merely implies the lack of any selling pressure in the indexes, the likelihood of a continued uptrend is fairly strong. These are market conditions that allow the candlestick investor to utilize simple scanning techniques to identify which stocks and/or sectors are producing the strongest bullish signals. Currently, gold prices continue to head higher and numerous gold stocks have produced very strong buy signals. Our recommendation today on GFI was based upon a best friend signal that gapped the price up through the resistance level, indicating wave three is now in progress. The best friend signal, a Doji followed by a gap up, not only produces high probabilities of a bullish trade, but also indicates a strong potential of a very strong profit trade.

The fry pan bottom pattern has been working extremely well in these market conditions. Numerous stocks have been producing profitable trades based upon the identification of a fry pan bottom i.e. NVAX, LVGO, MGNX. There are a number of stocks that have produced fry pan bottom patterns and are currently at breakout levels. The advantage of identifying a pattern at a breakout level means there is no waiting time to see if a pattern breakout is going to perform. CHGG and VIVO broke out through resistance levels today, making them very good high probability trade set ups upon positive opens tomorrow. This is the type of information that allows a candlestick investor to be in the absolute right place at the right time.

Chat session tonight at 8 PM ET.

Good investing,

The Candlestick Forum team.