Daily Market Comments - May 2017
05/31/17 - Stock Market Comments
The market indexes had the prospect of moving back into the flat trading range that occurred in most of the early part of May, producing a flat Frypan Bottom pattern with the hard selloff/recovery acting as the dimple. A lower close Today would make the prospects of flat trading a viable prognosis. Numerous stocks are starting to trade back below the T-line. If the market remains weak going into the close, reduced long positions. Maintaining or adding any long positions during a possible sideways market trend would require very strong buy signals.
05/30/17 - Stock Market Comments
The lack of strength/selling in the market indexes indicates there is no change of investor sentiment in the overall market trend. The only alert is the potential sideways mode of the Dow as seen prior to the big selloff two weeks ago. This would imply a Frypan Bottom type pattern with the sell off and recovery acting as the dimple. Currently, the lack of movement in the market continues to make the individual stock chart patterns the relevant analytical analysis. Staying long or short requires analyzing the specifics of each individual chart. Fortunately, there are still good profitable bullish charts as well as bearish charts. This is why we recommend Trend Analysis.
05/26/17 - Stock Market Comments
It is not unexpected to see some consolidation in the markets after a good strong bullish week, going into a long weekend. However, the consolidation does not illustrate any weakness or pullback, merely flat trading on the day. This does not deter any of the candlestick bullish charts from continuing their trends. The uptrend remains in progress, especially after Gapping up into new territory Yesterday through obvious resistance levels. Use the T-line as your ultimate trend indicator.
05/25/17 - Stock Market Comments
Today's positive trading in the markets has great relevancy. It has gapped the indexes up through recent high/obvious resistance levels. As long as the market indexes stay above the breakout levels, the prospects of another wave to the upside is highly likely. The big selling day of last week is now viewed as a profit-taking day versus a breakdown of investor sentiment. These market conditions are allowing the strong candlestick charts to perform with excessive profitability.
05/24/17 - Stock Market Comments
Today's market trading produces the same analysis as the past few days, the indexes remain above the T-line but without any dramatic buying and/or selling pressure. The uptrend in many Bullish stock prices is persistent but with backing and filling/profit-taking as the trends move higher. The T-line still remains a valuable trend indicator in slow upward waffling type moves. Stay predominantly long but having a few short positions in the portfolio is still going to produce profits. The indexes are approaching recent highs, making a breach of those levels a prospective J-hook Pattern Bullish confirmation.
05/23/17 - Stock Market Comments
Although there has been indecisive trading Today, the markets are not showing any selling pressure. The markets may not be showing any extravagant buying pressure but the fact that the indexes are still trading slightly positive and trading above the T-line continues to demonstrate the overall market is not moving one way or the other. These market conditions allow the candlestick signals and patterns to produce profits based upon investor sentiment in each individual stock/sector. Use each individual stock chart as the main criteria.
05/22/17 - Stock Market Comments
Today's positive trading, as long as it stays positive going into the close, will bring all the indexes backup above the T-line. Although the indexes are still trading below the recent highs, they have recouped the dark candle created last Wednesday. A close above the T-line Today provides better insights into investment sentiment. The hard selloff of Wednesday appears to be a profit-taking day versus a major reversal of the market trend. There is nothing yet in the candlestick charts to indicate the uptrend is continuing, but it does reveal that any selling is being offset by the strength of bullish sentiment. Even if this creates more sideways/slow uptrend in the overall market, it will allow for candlestick chart patterns to perform with good strength based upon the lack of any selling pressure in the market. This is why we recommend Trend Analysis.
05/19/17 - Stock Market Comments
Today's positive trading is making the T-line relevant for the NASDAQ and the S&P 500, the Dow is currently testing the 50 Day Moving Average. The markets need to close near the high end of the range to indicate Wednesday's big draw down was merely emotional selling versus a dramatic change of investor sentiment. A close near the top end of today's trading range is important for illustrating a recovery versus a temporary bounce after a strong sell signal. Based upon the nature of the market for the past three months, a new flat trading range could be developing, as seen in the sideways movement of the markets after a big move one way or the other. This still allows for candlestick patterns to work effectively. Currently there are numerous J-hook Patterns bouncing back up from the T-line.
05/18/17 - Stock Market Comments
There is a better visual of RSI. That is the T-line. Watch how the individual charts that remained above the T-line in Yesterday's sell off will likely have a much faster and stronger recovery than those that close well below the T-line Yesterday. Although the market is rebounding, be careful. It may merely be moving back up to the level it was trading prior to the final hour of panic selling. A close below the halfway point of Yesterday's candle in the indexes would still illustrate the Bears are currently in control. The NASDAQ is currently the strongest index in today's trading but still not yet back up to the halfway point of Yesterday's candle. The indexes Gapping down from candlestick reversal signals demonstrates the strength of the selling. The downtrend need something dramatic to offset that message.
05/17/17 - Stock Market Comments
Knee-jerk reaction or a major change of investor sentiment? That question will be best answered on what type of candlestick formation is created in today's trading. If the trading remains toward the lower end of today's trading range, it now becomes a Bearish Best Friend Signal in the Dow, a Doji followed by a Gap Down. The NASDAQ would be a Hanging Man Signal followed by a Gap Down. If the markets trade near the top end of their trading range Today, creating indecisive/Hammer type signals, that would reveal Today's profit-taking was merely profit-taking.
05/16/17 - Stock Market Comments
After opening positive this morning but now currently trading a little bit lower the market indexes still have not shown anything that would show any change of investor sentiment. Unless there is a dramatic sell signal in the markets, as long as the indexes continue to trade above the T-line it has to be assumed the uptrend is in progress. This is allowing candlestick charts to produce big profits without any major worry of selling occurring in the market, i.e. SINA,NVDA,AMZN, VRX, AKBA. The probabilities of Candlestick Pattern Breakouts remain very strong when there is nothing in the markets that show potential reversals.
05/15/17 - Stock Market Comments
Today's positive trading affirms the lack of strength from the Bears, which would have been a viable prospect with the Dow and S&P 500 closing below the T-line a couple times last week. However, as can be seen in the Dow and S&P 500 candlestick formations, the Doji's/Hammer Signals illustrated a lack of decisiveness. Today's positive trading is currently bringing all the indexes backup above the T-line. The NASDAQ, trading in decisively each day last week, could never close below the T-line. The same prognosis remains, the uptrend remains in progress as long as the indexes continue to close above the T-line.
05/12/17 - Stock Market Comments
The Doji/Hammer type signals that formed in the Dow and S&P 500 Yesterday demonstrated that the Bulls have not left the market yet. But a lower open in those indexes today indicated the lack of any significant Bullish buying, keeping the overall market trend in a sideways/slightly downward trend. The term slightly downward is illustrated by the fact that numerous stocks are still trading positive, especially the biggies, AMZN. AAPL,NFLX, NVDA.
05/11/17 - Stock Market Comments
As illustrated in the Dow chart yesterday, a close below the T-line was an indication there might be some consolidation over the next few days. The NASDAQ is currently trading right at the T-line. The S&P 500 is trading below the T-line. Except for the NASDAQ, the other indexes are showing weakness/sell signals at the same levels the indexes topped out back in March. The main driving force of the markets are still predicated upon the expectations of things getting done in Washington DC. The market itself acts as a barometer as to what investor sentiment feels is being accomplished between our illustrious politicians. Expects some more sideways/consolidation.
05/10/17 - Stock Market Comments
The NASDAQ, although selling lower today so far, is still supporting on the 3T-line. The S&P 500 has supported on the T-line. The Dow is showing the greatest weakness with it trading below the T-line, but not yet showing any decisive movement either Bullish or Bearish. The most profitable/productive trades continue to be results of Candlestick Patterns, Frypan Bottoms and J-hook Patterns. The overall market uptrend remains in progress albeit very slow. This is why we recommend Trend Analysis.
05/09/17 - Stock Market Comments
The NASDAQ is showing the most Bullish confirmation today. Note how it gapped up through the J-hook pattern resistance level. The breakout into new territory confirms a J-hook pattern has a high probability of continuing the uptrend. The gap up into new territory adds additional credibility to the J-hook Pattern. A close near the high end of the trading range Today would be a good indication that wave three of the J-hook pattern is in progress.
05/08/17 - Stock Market Comments
When the markets or a stock price is not showing any decisive move, the T-line becomes a very important confirming indicator. Currently the Dow, the NASDAQ, and the S&P 500 are demonstrating potential J-hook pattern setups. What makes that analysis more compelling is the fact that each index has use the T-line for a support area, during the previous uptrend and for showing support for a J-hook pullback. The T-line makes for a very simple trend analysis. As long as trading stays above the T-line, the uptrend is assumed to be in progress.
05/05/17 - Stock Market Comments
The markets continue to show definite indecision. It would be assumed that the market would pick up strength after the Dow about whether a healthcare bill was going to pass or not. However, this is a perfect example that no matter what each individual may think should happen has absolutely nothing to do with what the markets actually do. This is why the Japanese Rice traders always profess to let the market tell you what the market is doing, not what we think it should be doing. Today's trading is not producing any vibrant action. Each individual chart should be the primary analytical factor. The T-line remains an important trend indicator.
05/04/17 - Stock Market Comments
Today's indecisive trading in the markets is probably the wait and see mode for the results of the healthcare vote. The market still illustrate the lack of any change of the current investor sentiment, an uptrending market. As long as the indexes remain above the T-line, albeit indecisively, the good trending/good pattern charts continue to move in the right direction. The magnitude of movement is somewhat diminished with the sideways mode of the market but still producing good profits. Our June Live Cattle trade, utilizing the classic pattern/J-hook pattern has produced huge profits with the price gapping up daily since the J-hook pattern breakout. This illustrates the simple strategy of candlestick analysis. It allows you to close out bad trades quickly and let your profitable trades run until you see a sell signal.
05/03/17 - Stock Market Comments
Today's lower open in the NASDAQ after Yesterday's hanging man signal in the overbought condition illustrates the area of profit-taking in the NASDAQ trend. The Dow and S&P 500 are trading lower but in decisively, Doji type days. The T-line remains a relevant factor, both for analyzing the market trend as well as individual stock moves. FUEL illustrates a J-hook pattern using the T-line as support. Our recommendation on LNTH based upon the Doji Sandwich breakout had a potential sell signal Yesterday but did not close below the T-line.
05/02/17 - Stock Market Comments
The flat trading in the Dow and S&P 500, after the gap up breakout of the Downtrending Channel of last week, implies the sideways consolidation will continue probably until the T-line catches up. The NASDAQ continues to use the 3T-line as a support area, creating a stable uptrend. The transportation index is trading positive so far Today, revealing the lack of any major selling pressure. The lack of any selling pressure is evident when you accumulate the analysis of all the indexes. This makes the candlestick charts still working effectively coming out of patterns, such as the Frypan Bottom and J-hook Patterns.
05/01/17 - Stock Market Comments
Nothing has altered the current trend. The potential sell signals in the Dow and S&P 500 that formed on Friday are not currently confirming a reversal Today. The NASDAQ, gapping back up toward the open of Friday and continuing to trade positive illustrates the continuation of the current uptrend. The 3T-line has acted as the support for this uptrend in the major indexes. The political rhetoric from Washington DC remains the probable investor sentiment influence.