After the gap up in the indexes yesterday, in the overbought area, it was not unexpected to see some profit-taking today. Today’s selling appears to be more profit-taking than any major reversal of investor sentiment because the candlestick signals are not showing any compelling sell signals. The underlying analysis is still that the indexes are trading above the T-line. The lack of any decisive selling continues to allow candlestick chart patterns to produce good profits, i.e. RIOT and the message signal in SQM. Continue to maintain positions that are not showing reversals but do not hesitate to take some profits in charts that are illustrating overbought conditions that have moved too far away from the T-line. There will always be some more excellent buy signals elsewhere.
December 19th Daily Market Comments
After the gap up in the indexes yesterday, in the overbought area, it was not unexpected to see some profit-taking today. Today’s selling appears to be more profit-taking than any major reversal of investor sentiment because the candlestick signals are not showing any compelling sell signals. The underlying analysis is still that the indexes are trading above the T-line. The lack of any decisive selling continues to allow candlestick chart patterns to produce good profits, i.e. RIOT and the message signal in SQM. Continue to maintain positions that are not showing reversals but do not hesitate to take some profits in charts that are illustrating overbought conditions that have moved too far away from the T-line. There will always be some more excellent buy signals elsewhere.