May 17th Market Wrap-Up
The market indexes showed indecisive trading on Thursday, Doji days. However, all the indexes are still trading above the T line. This would imply the uptrend is in progress. The Doji provides a very simple trading rule. The trend will usually move in the direction of how they open after a Doji. That makes the analysis of the overall market trend easy to assess, based upon how it opens tomorrow. A lower open would put the support of the T line in jeopardy, indicating some more sideways or downward trending movement in the markets. A positive open would confirm the possibility of a J-hook pattern which would indicate more upside. This analysis is made much more easy knowing what should occur after specific candlestick signals, such as a Doji, and it's relationship to the T line. The signals are created by human nature. The results of the signals are based upon high probability expectations of what should occur after candlestick signals.
One of the most powerful breakout patterns is the slow curve. This was illustrated in the RIOT chart today after the slow curve broke out through the 50 day moving average as well as an obvious resistance level. Knowing what type of price patterns have the most power and high probability results allows candlestick investors to get into explosive trades at the appropriate time.
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The Candlestick Forum Team
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