The same common sense that is applied to each individual signal can be applied to analyzing the trend. Proper investing involves getting into positions when the signals say it is time to get in and getting back out when they say it is time to get out. However, one of the big investment fears is getting out of a profitable trade too early. That is one of the emotional factors that candlestick signals help to overcome. We buy a stock at $10 a share on a candlestick buy signal. A candlestick sell signal appears at $15 a share. As the price was moving up, what becomes the dream of most investors? Being in the stock that is finally going to make them rich. The stronger the price move, the more our imaginations envision finally being in the mega-profit position. Then a "sell" signal appears.

A sell signal becomes a wet towel for our big price move dreams. Unfortunately, the sell signal is a reality check. The disciplined investor realizes that if a sell signal confirms, that will be the profits from that trade. On the other hand, candlestick analysis provides some very simple analytical techniques that help decipher whether a big price move is still in progress. Most investors have the stigma of not wanting to buy back into a position. This is based upon the same fear of looking-stupid syndrome. What if we sold a stock at $15 and it went to $35? Boy, would we look stupid! What if we sold a stock at $15 on a candlestick sell signal and it immediately turned around and continued to go higher? If we buy it back at a higher price and it immediately went back down, boy would we really look stupid!

Candlestick analysis alleviates that mental trauma. There will be times when it is time to sell. And then time to buy back the same stock at a higher price. The point of investing is to maximize your profits for your account, not each individual trade. There is nothing wrong with taking profits when the signals indicate it's time to take profits. There is nothing wrong with buying  that position back to when new signals indicate it is time to be buying again.

Trend analysis is utilizing the information built into each individual formation during a trend. Whether an individual stock, currency, commodity or the market indexes themselves, knowing what the trend is revealing becomes very important for evaluating when to come out of a position. The same common sense elements involved for analyzing an individual stock price can be put into the analysis of the market trend. This becomes very important for analyzing high profit patterns in individual stocks. The ability to evaluate whether a trend is moving consistently in one direction or the other allows the candlestick investor to take advantage of high profit price moves based upon patterns working well during specific market conditions.

NIHD

The Dow has moved steadily in an upward direction for the past seven weeks. Today's trading showed a little weakness on the close. This should allow the tee line to catch up. The same scenario is true for the NASDAQ. The slow uptrend remains in progress as long as the markets close above the tee line. Remember, the further prices move away from the tee line, the more likely a pullback will occur.

DOW

The tee line demonstrates a slow upward trend. Current signals in both the Dow and the NASDAQ indicate indecisive trading. This would illustrate the potential of a slow 'backing and filling' type market as the uptrend continues.

Nas

The further prices move away from the tee line, the more likely a pullback or a sideways movement will occur, allowing the tee line to catch up. Although the markets did not produce any strong gains today, there was a high number of stocks still moving in a positive direction.

If you did not attend the online training session, the today training is now available on video. Please check the newsletter special.

Thursday night training session -- May 8, 2008 guest speaker will be David Elliott. Dave Elliott and Steve Bigalow have been good friends for many years. Their technical analysis fits very well together. Mr. Bigalow's candlestick analysis, added to David's Elliott research of indicators that produce a high probability of a specific result, have produced some excellent fine tuned investment/trading combinations. Mark your calendar! Dave's information is excellent for those investors that want to dramatically improve the probabilities of being in the right trade at the right time.

Good investing,

The Candlestick Forum Team

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