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Stock Market Crash - Not According to Candlestick Signals

There is constant speculation for the next stock market crash.  A stock market crash is always a worry for a certain percentage of the investment community. However, candlestick signals can greatly alleviate that fear.  A stock market crash does not occur in one day, one week, or one month. Selling will occur prior to a stock market crash. 

The great stock market crash of October 1929 had clear evidence of selling in the markets starting in August of that year.  Each stock market crash in the 1980s and 1990s did not occur instantly. Candlestick sell signals made it clear that the directions of the markets were bearish well before the crashes occurred in. The signals will reveal the set up for another crash well before it occurs. Currently,  there are no indications that another stock market crash is in the making.

 

On the contrary, the Dow has been forming a rounding bottom formation for the past three months. This indicates a slow steady consolidation, a reaffirming that investor sentiment is gaining confidence. The fundamentals of the economy, low interest rates, improving earnings, and consistent consumer spending does not bode for anything but a strong steady economy.

 

Market Direction - The Dow has recently broken out into new high territory for the past few years.  This occurring after the identification of a spreading pattern that formed in the Dow.  The result of a spreading pattern is a strong trend. In this case, the spreading pattern indicated a strong upward trend.  This could warrant an uptrend that could maintain for the next few weeks. Continue to hold your long positions.

 

 

The results of these scans in the past couple of trading days reveals strong buying coming back into the oil related stocks.  Although crude oil prices have dropped dramatically over the past month, it appears as if crude oil stock prices have ended their profit taking.  The next move should be a strong move to the upside.  At least one or two positions in the oil related area should be added to the portfolio at this time.

 

 

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