November 16th Market Direction

What is a major advantage of candlestick investing over most investors trading? Most investors have mediocre returns because even during a strong uptrend, they will hold positions that are not working or even trading lower. Candlestick investors circumvent that mediocrity. Simple scanning techniques allow for identifying which sectors are the strongest and which sectors are not working. This produces the trading strategy for investors to quickly close out trades that are not working and moving to sectors that are showing the best strength. This produces much better returns because all the trades should be moving in the right direction. Currently, electric vehicles, lithium mining, and the oil sector are acting the strongest. Having the portfolio oriented toward the strong sectors during a market uptrend dramatically enhances the profitability of the portfolio.

Lithium mining stocks such as WWR, LTHM and PLL are producing strong returns. There will always be uptrending stock prices in an uptrending market, but the strongest profits come from identifying candlestick reversal signals and patterns that produce much better probabilities of profitable trades. The bobble breakout is a very powerful bullish price pattern set up. The shipping stocks, STNG, FRO, and TNK are all showing bobble breakout potential. Oil stocks have shown support and breakouts at the 50 day moving average making the 200 day moving average likely targets. Taking advantage of the information that is built into candlestick analysis allows an investor to take the guesswork out of which stocks/sectors will work the best. Having the majority of the portfolio positions in the sectors during an uptrend dramatically reduces the potential of mediocrity returns. The more pieces of evidence you can put into your analysis, the better the probabilities of being in a correct trade. Join us this Saturday for a a candlestick training on Convergence Analysis, identifying multiple confirming indicators that dramatically improve the probability of being in the correct trade at the correct time.

Chat session tonight at 8 PM ET, identifying the best sectors.


Good investing,

The Candlestick Forum team