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August 16th Market Wrap-Up

Today's positive trading in the Dow provides a valuable insight into the investor sentiment of this market. The Dow formed a very strong bullish confirmation after yesterday's hammer signal that bounced off the 50 day moving average. The S&P 500 gapped up and formed a kicker type signal above the T line, after yesterday's hammer type signal. However, although the NASDAQ traded higher, it was trading below where it opened. This combination implies there is still bullish participation in this market but not necessarily any dramatic trend indicator. The slow upward/sideways trend motion remains in progress, making each individual stock chart the top assessment factor. This is due to the markets indicating that although it is not heading lower based upon today's trading, it is not necessarily heading higher with any great resiliency. The visual aspects of candlestick analysis allows an investor to see much more accurately what is occurring in investor sentiment when analyzing the overall trend. Knowing that there is a lack of dramatic selling pressure in the overall market allows for participating in stock price movements that are showing strong trend signals.

AAPL has created a price pattern that produces a high probability that it will move higher. This evaluation is further viable based upon the overall market not showing any severe selling pressure. The analysis is fairly simple. If there is strong buy signals in specific stocks and there is no overall selling pressure in the market, the probabilities dramatically improve the bullish signal is going to create better profits.

 

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Good Investing,

The Candlestick Forum Team


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