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February 1st Market Wrap-up

The selling in the market indexes on Tuesday did something it hadn't done for the past year. The indexes gapped down through the T line after a candlestick reversal signal. The markets have traded back below the T line during the last 12 months uptrend but not with a gap down through the T line. This shows more bearish force than has been seen during the uptrend. However, the lack of decisiveness selling has been witnessed in Wednesday and Thursdays trading. Although a strong potential sell signal has been created, further confirmation is required to offset the well-established bullish sentiment that has perpetuated the uptrend. The uptrend has now had a chink in the armor, putting some doubt in the bullish sentiment. When markets get into a condition where it does not demonstrate a defined bullish or bearish movement, the prudent trading strategy becomes having both long and short positions in the portfolio.

It is easy to identify which stocks/sectors are the most bullish and the most bearish. This allows investors to continue to make good profits even when the overall market trend has flattened out. Because the scanning techniques for finding the best candlestick trades is done on a visual basis, the best trades for the following time frames can be quickly identified in less than 20 minutes every afternoon. Knowing what each signal and pattern illustrate constantly puts investors in high probability trades set ups.

 

 

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Good Investing,

The Candlestick Forum Team


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