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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Good investing,
The Candlestick Forum team.
