Candlestick analysis has the capability of dramatically improving the probabilities of anticipating what investor sentiment is about to do, or is doing! Being able to recognize the strong candlestick signals and patterns allows an investor to make much more accurate assessment as to which stock/sectors are getting bullish or bearish sentiment. The analysis is then further enhanced by identifying which stocks in a sector are producing the strongest signals. This is putting all the stars in alignment. Recognizing a pattern set up and knowing what the results of candlestick signals will produce at breakout levels allows for the exact entry points in high profit potential trades.
The confirmation of a pattern or signal is also enhanced by using the T line, a natural support and resistance level of human nature. An investors analytical ability is greatly improved when recognizing what investor sentiment is doing at observable technical levels. Currently, the markets are overbought and illustrating indecisive trading. This creates an alert to be prepared to start taking profits and/or adding short positions to the portfolio. Which positions do you want to stay long when the market is in overbought area? The candlestick signals and patterns that are producing excessively strong bullish or bearish trend signals. You do not have to be a technical analyst to benefit from the visual aspects of candlestick signals.
Chat session tonight at 8 PM ET.
Good investing,
The Candlestick Forum team
