What is every investor looking for? Hot stock market picks!!! Everybody wants to find the stock that is going to make them wealthy. Hot stock market picks is the Golden Goose that all investors try to find. Is there a system for finding hot stock market picks? Not really, but one of the best investment tools for finding the hot stock market picks is candlestick signals. The signals do not necessarily identify hot stock market picks, they simply put investors into positions that have a high probability of producing big-profit moves.
Candlestick signals identify where money is flowing into and out of stocks/sectors. Being able to identify and understand the investor psychology that creates the candlestick signals produces a huge advantage. It allows an investor to participate in stock investments that have an extremely high probability of moving in the right direction. The signals are created by common sense investment practices. Trying to identify hot stock market picks is a long shot. However, utilizing candlestick signals dramatically increases the probabilities of being in a strong price move. The signals have been developed through hundreds of years of visual analysis. When investor sentiment starts turning, the Japanese Rice traders identified the signals that illustrated the change.
The point of investing is to put investment funds into situations that have the highest probabilities of making money. Will there be failed trades? Of course, and the candlestick signals reveal when to get out of those trades very quickly. Will candlestick signals put investors into hot stock market picks? The candlestick signals do not identify the hot stock market picks, they put investors funds into trading patterns that increase the probabilities of participating in big price moves when they occur. Utilizing the signals correctly will dramatically improve the probabilities of being in the right place at the right time. Use to your advantage. Learn the 12 major signals well and you’ll understand why prices move. Be aware of the secondary signals because they can also produce the evaluation of whether to get in or stay in positions.
Trading the Upside Gap Two Crows Pattern
Description
The Upside Gap Two Crows is a three-day pattern. The upside-gap is created between the long white candle at the top of an uptrend and the small black candle of the second day. The black candle gaps open and pulls back before the end of the day. Even though it has pulled back, it did not fill the gap. The third day opens above where the first black candle opened. It can not hold at these levels and pulls back before the end of the day. Closing lower than the previous day, it has engulfed the small black candle’s body. However, it still did not close the gap from the white candle.
Criteria
- A long white candle continues the uptrend.
- The real body of the next day is black while gapping up and not filling the gap.
- The third day opens higher than the second day’s open and closes below the second day’s close. This produces a black candle that completely engulfs the small black candle.
- The close of the third day is still above the close of the last white candle.
Pattern Psychology
After a strong uptrend has been in effect, the atmosphere is bullish. The price gaps open but cannot hold the gains. Before the end of the day, the bears step in and take the price back down. However, the gap up from the white candle was not filled. The next day, the bulls try again; they open the price higher than the open of the previous day. Again, they cannot hold the price up. It backs off and closes lower than the previous day. This now has taken all the steam out of the bulls. At this point, you will want to see the bears really stepping in the next day to confirm the reversal. (This pattern is not as bearish as the Two Crow Pattern)
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