Today’s positive trading was not unexpected when analyzing candlestick charts. The 50-day moving average illustrated it was acting as support when there was a piercing signal formed in the Dow on Thursday. The NASDAQ bounced off the lower trend channel and eventually closed above the T line on Thursday, then again on Friday. This provided the probabilities that investor sentiment was not ready to sell off the market. Investor sentiment is also easy to evaluate based upon the positive news this morning about the possibilities of a vaccine close to be in developed. Today’s positive trading puts the market conditions well in the middle of the trading channels, the NASDAQ showing much more bullish movement in an up trending channel. This is allowing for numerous candlestick patterns to work very effectively. The J hook patterns have been very profitable. The scoop patterns are setting up for strong slingshot up moves. Simple Candlestick scans find the strong trade set-ups very easily.
NAIL is a strong chart set-up as a scoop pattern breaking up through the 50 day moving average. The gap-up in today’s trading provides a high probability of a strong uptrend with a scoop pattern breakout. The numerous J-hook patterns recently recommended are continuing to show very good profitability. It is simple to maintain these profitable trades. Stay long as long as they close above the T-line. The slow up trending market allows for these type of patterns to perform with much greater upside potential, because there is not any bearish sentiment creating any hesitation in the pattern breakout moves. Utilizing pattern breakouts allows the candlestick investor to take advantage of the uptrend by being in positions that are going to produce much greater profitability than merely up trending stocks during an uptrend.
Chat session tonight at 8 PM ET.
Good investing,
The Candlestick Forum team.
