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April 6th Market Wrap-Up

The indecisive trend of the markets can be better assessed in the fact that it is producing indecisive trading days; Doji's, hammer Doji's, spinning tops, right at the T-line level. The Dow has been drifting sideways for two weeks waiting for the 50 day moving average to catch up. The candlestick investor has the advantage of identifying what type of nature investor sentiment is producing in a current trend move. The better illustrations of candlestick charts indicate bullish sentiment one day, bearish sentiment the next day. This obviously creates a market condition that is not helping or hurting most of the individual stock price moves. Fortunately for candlestick investors, simple scanning techniques reveal which stocks have the strongest bullish or bearish price activity occurring. This produces a constant supply of trading opportunities even though the general market is trading absolutely flat.

The recommendation of COOL is much more easily evaluated as be in a strong trading opportunity based upon the patterns that can be easily visualized. The frypan bottom breakout produced the strong uptrend as expected. During the uptrend there was obvious J-hook patterns. Obvious in the sense that the price did not close below the T-line. After exuberant buying in the overbought condition, sell signals made for the opportunity to take profits at the appropriate time. Today's positive trading, indicating the T-line was acting as support once again, allows candlestick investors to reestablish the trade with an extremely high degree of probability that the profit-taking is over and a new uptrend is in progress. When you take profits? When do you reenter a profitable trade set up? The candlestick signals and confirming indicators make this a very easy process.

 

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Good Investing,

The Candlestick Forum Team

 


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