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November 1st Market Wrap-Up

Today's positive trading in the indexes improves the probabilities of the market starts to move higher based upon taking the non-bullish signals in the Dow and NASDAQ and creating a bullish Doji sandwich today. This now adds to the credibility of the bullish movement in the market. From this point, the uptrend remains easy to analyze as long as there is not a candlestick sell signal and a close back below the T line. However, the after hours earnings report from Apple may put a damper on the current uptrend of the market. With Apple beating earnings, it is trading lower after hours. This Is a Good Illustration the candlestick charts indicate what investor sentiment thinks about earnings/events. How far might the markets pullback with Apple trading lower? This is why high probability trend indicators, such as the T line, become very valuable for assessing the strength and continuation of a price move.

The Doji sandwich is a very high probability candlestick signal that allows investors to make the assessment that prices are going to continue higher, the common aftermath of a Doji sandwich. It becomes much more relevant when the Doji sandwich pushes prices through the T line, creating much higher probabilities that a reversal of a price trend has occurred. Knowing these little expectations from candlestick signals allows an investor to move much more quickly and aggressively when establishing positions after a price reversal has occurred.

 

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Good Investing,

The Candlestick Forum Team


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