Identifying the uptrend in a continuation process is relatively easy utilizing candlestick signals. Price movements that create patterns that are identified by most investors are confirmed more quickly when evaluating the signals that show strength at pattern breakout levels. This was illustrated in a breakout in the Dow, S&P 500, and the NASDAQ when the next wave was confirmed with candlestick bullish signals. Because candlestick signals are the graphic depiction of human nature and the T-line is a natural support and resistance level of investor sentiment, utilizing the combination provides very high probability trend analysis. The current uptrend remains in progress as it is continuing to trade above the T line. The first analysis of profitable trading is identifying the overall trend of the market indexes. This becomes much more accurate when using the information built into candlestick signals and patterns.
All boats rise in a rising tide! However, identifying the candlestick signals and patterns that produce the highest profit trade results allows candlestick investors to make much greater profits knowing that the overall market trend is continuing in a slow uptrend. The best friend signal, the J-hook pattern, and the frypan bottom are just a few of the candlestick patterns that allow for much greater profitability than merely holding stocks that are moving up slowly in a slow uptrend.GH is showing good strength because of a best friend gap up. DXC provides very strong upside profitability based upon a best friend gap up confirming a frypan bottom breakout. Because candlestick patterns produce to results, a high probability of being in a profitable price move and the results of the price moves are much greater when the patterns produce breakouts, the profitability of an overall positioning of the portfolio is dramatically improved. The percentage of correct trades are dramatically improved based upon the high probability results of candlestick signals. Where most investors have decent portfolio returns during an uptrend, due to a majority of stocks moving positive while a few positions are trading negative, the candlestick investor has the benefit of greatly reducing the number of trades in the portfolio trading lower.
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Good Investing,
The Candlestick Forum Team
