How do most investors learn to invest? Usually by the seat-of-the-pants. The common advice by the so-called professional investment advisers is to buy good companies and hold them long-term. We are told that you cannot time the market. However, if that is so true, why do the names Warren Buffett and George Soros mean so much to us?

They have learned how to time the market. The Candlestick signals reveal what investors are thinking about the future of price trends right now. Buying the best company in the world with a stock price that has not moved will not make us money. Buying stocks that have signals revealing that the investors are buying is what creates profits. The Candlestick signals show us exactly that, especially the 12 major signals. Understanding where the major signals work effectively in price trends is not a difficult process.

Learning stock investing does not require an MBA from college or years of intensive study to discover which stocks have the greatest upside potential. In a few weeks of studying the major signals, an investor can develop investment perceptions that will constantly put the probabilities of pulling profits from the market greatly in their favor. The Candlestick signals provide an immense amount of information when analyzing price movements.

Learning what the Candlestick signals reveal will allow a Candlestick investor to understand the human factors that make price trends move and reverse. The Dow Jones average formed two Evening Star signals this past week. What should that indicate? An Evening Star signal reveals that the sellers are now stepping in. Having the knowledge of what those Evening Star signals represent permit the Candlestick investor to exploit profits from the markets.

Market Direction - The stochastics of both the NASDAQ and the Dow have been in the overbought area for a number of weeks. As you should have witnessed in our free morning comments each day, it has been advised to maintain the long positions that have been in strong chart patterns, while taking profits in the charts that were topping out. It also has been advised this past week to maintain your long positions but, due to the first Evening Star signal, adding some short positions to the portfolio would have been prudent as well.

This advice stemmed from the indication of the selling starting to come into the markets. The trend had remained consistent to the upside since late October, starting from a strong Morning Star signal.

The DOW

An Evening Star signal is one of the major Candlestick sell signals. As we saw, an Evening Star signal formed Monday and Tuesday of this week. Wednesday, with a strong bullish candle, could have negated the sell signal. However, seeing a major Candlestick sell signal, in an overbought condition, becomes an alert that the sellers have now made their presence known. Although we saw a strong bullish move on Wednesday, the Evening Star signal provided suspicion that we might be seeing the last of the uptrend. Thursday formed a small “star” trading pattern, representing more indecision. Friday's hard sell-off, after the day of indecision, formed another Evening Star formation.

The second Evening Star signal clearly demonstrates more selling pressure. Having been alerted earlier in the week that the sellers may be coming into the market, the second Candlestick sell signal provided more evidence that it was time to take profits and that it may be time to look for short positions.

Oil Prices Rebounding - With the stock market consistently in the overbought area, it is not outlandish for investors to find a reason to take profits. This became more evident as the week progressed. Oil prices, which had been the stimulant for equities over the past few weeks, falling from $55 a barrel down to $46 a barrel, kept adding strength to the equities market. However, when the stochastics got to the oversold level in the Crude Oil chart, Candlestick buy signals started to appear.

Notice the gap-down Hammer signal that formed early in the week when the stochastics were in the oversold area. One of the basic rules of Candlestick analysis is that when you see a gap-down in price in an oversold condition, start looking for buy signals. The gap-down Hammer was followed a couple days later by a Piercing Pattern. Both the Hammer and the Piercing Pattern are considered major Candlesticks signals. This would give reason to suspect an upward bounce in oil prices.

Knowing that the oil prices were influencing investor sentiment in the stock market, and assuming that the stock market was in an overbought condition, being able to analyze what oil prices were about to do gave some insights into what the stock market direction might do. This is not a difficult process. Understanding what the signals represent makes analyzing all markets that much easier. And being able to add all these indicators together provides a much better trading program for taking advantage of market reversals.

Candlestick Forum CD Training Special – wouldn’t you like to be able to analyze market trends like a professional investor? For those investors who want to learn how to use the major signals effectively, the 12 CD set of the major signals is available on the site. Each 45 minute training CD goes in depth into what makes each signal effective, where it occurs in a trend that makes it highly effective, and most importantly what the investor sentiment was behind the formation of that signal. Once you understand the psychology that is built into the signals, you will have a powerful understanding of how price movements occur.

The 12 training CDs, if bought individually, are a $509 value. However, if you purchase the full training package before November 26, 2004 at the $397.77 price, you will also receive the “Gaps at the Bottom” training video, a $69.77 value, and the attractive Candlestick Forum “Major Signals” poster, a $23.95 value, for FREE.

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Learning how to use Candlestick signals to takes years to master if you do not learn them correctly. The advantage you have today is being able to learn how to use the major signals in an easy-to-understand process. The visual education that is provided in the training CDs will advance your investment knowledge by decades. Why learn from your mistakes? Learn exactly what you need to produce high profits in any trading market.

Take advantage of this valuable information special. You’ll receive a $93.72 of additional Candlestick education in addition to the $111.23 discount on the “Major Candlestick Signals” training program. Take advantage of this opportunity to learn Candlestick signals thoroughly. Candlestick signals produce remarkable results. There is no reason why you shouldn’t fully understand the powerful implications that are conveyed in Candlestick signals.

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Members' Special - Wednesday, November 24, download your free video
“Morning Star and Evening Star signals“. This 45 minutes training CD goes into depth on how and where these signals work most effectively for identifying trend reversals. As you go through the training CD, Steve Bigalow will explain in clear fashion what confirming indicators make the Morning Star and Evening Star signals perform with an extremely high degree of accuracy.

Tuesday Night, November 23, Steve Bigalow will be giving a free Candlestick presentation in Chicago at the Wyndham Garden Hotel, 800 National Parkway, Schaumburg, Illinois. All are invited.

Good Trading,

- The Candlestick Forum Staff

www.candlestickforum.com