Bearish Wedge Breakout

The strong selling Today in the Dow showed a bearish candlestick formation, reaching the lower end of a wedge formation. This demonstrates a change of investor sentiment, especially when applied to a pattern everybody is watching. Add the information that the NASDAQ, although trading higher Today, traded as another indecisive day after the gap up Doji from last week. This combination indicates the market trend is starting to get tired. The probabilities are starting to change. This information allows the candlestick investor to be more aggressive for taking profits or closing out long trades that are starting to show weakness. It also allows for more emphasis to be placed upon scanning for going short positions. Although numerous trends are not showing confirm sell signals, by closing below the T line, the nature of candlestick charts allows for identifying when investor sentiment is starting to change. This is the evaluation that is much easier to identify when investor sentiment is changing. Our full day training on when to take profits scheduled for September 18 will be an in-depth analysis of when to take profits even though a confirmed candlestick sell signal has not yet occurred. Candlestick analysis allows investors to identify when the probabilities are starting to change. Join us September 18, this is information that most investors do not get enough of.

The J-hook pattern is still producing good high probability/high profit results even though the market, in general, is starting to show weakness. The candlestick investor gains a huge advantage of knowing what should result after specific candlestick signals and patterns. This is based upon the most consistent trend indicator in the world, human nature. You gain valuable insights into market and stock price trends when you know what the candlestick signals are telling you.



Good investing,

The Candlestick Forum team