January 30th Market Direction

Candlestick reversal signals appeared in today’s market trading. This is not unexpected with the markets in the overbought area at technical levels everybody else was watching. The Dow formed an evening star signal, one of the 12 major candlestick reversal signals. The S&P 500 began a bearish kicker-type signal. Although the NASDAQ did not form a candlestick reversal signal, one of the changes identified in our Candlestick training is when prices gapped down and close back below the open of the previous candle of an uptrend. There will be a high probability of selling continuing. This allows for quicker closings of bullish positions that are starting to show potential weakness/sell signals. This information provides the candlestick investor with immediate information and allows for better profit-taking. Everything built into candlestick charts is merely common sense put into a graphic depiction. When do you enter a trade? When do you exit a trade? This is information that is much more identified, knowing what signals and patterns investor sentiment produce time after time.

 

 

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Good Investing,

Stephen Bigalow

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