Simple candlestick charting techniques help maximize profit-taking. Using the T-line rule, when prices move too far away from the T-line, on a daily chart, simply move to the 10 minute chart to show when there is a change of investor sentiment. This process allows investors to maximize a profitable trade well before it starts heading back to test the T-line. This was demonstrated in a very strong profit VIAC short trade this week. When prices move too far away from the T-line, that becomes a simple alert for being prepared to start taking profits. This is the result of reoccurring human nature reactions. The Dow is in the process of forming another bullish J-hook pattern, the S&P 500 also following that pattern set up.
This implies more upside, especially with the strength being exhibited in the transportation index. The NASDAQ trading positive is still in a sideways wedge formation, at least indicating the lack of any major selling pressure yet in the market indexes. This demonstrates also that specific sectors are starting to show bullish signals. The steel company sector has very strong charts,X, SCHN STLD,ZEUS, AA,RYI. The metal mining companies are also acting strong, BBL,MT,SXC,NUE, CENX, TMST, CMC. J-hook patterns in the Dow and S&P 500 imply more upside in the markets.
