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Stock Investing Programs Enhanced with Candlestick Signals

Stock investing programs become greatly improved when applying candlestick signals. Most stock investing programs involve analysis  that anticipate and/or suggest when a reversal of a trend should occur. Trend lines, Fibonacci numbers, or moving averages are all indicators utilized in technical analysis.

Candlestick signals convey an immense amount of information when applied to other technical analysis. The reversals of trends, that most investors 'anticipate' in their stock investing programs,  are definitely revealed with candlestick signals at important technical levels. This provides a huge advantage for the investor that utilizes candlestick analysis.

Most stock investing programs employ entry strategies that require confirmation after  a specific technical level has indicated a reversal. The confirmation usually involves prices moving up through a price level after a support level has been touched. The advantage the candlestick investor has is being able to view what investor sentiment was doing right at the time prices hit a support level. This immediate information makes stock trading entry strategies and stop loss procedures extremely efficient. Witnessing a candlestick buy signal at an important support level allows an investor to enter a trade before most investors decide to enter that trade. The candlestick investor  benefits from the price move of other investors entering the trade as they feel the support level is being confirmed. Additionally, the closer the entry level can be established to the obvious support level, the smaller the price move will be in the stop loss process if prices reverse and go back down through the support level.

Investment professionals always provide the sage advice to let your profits run and cut your losses short. However, very rarely do they reveal how to implement that advice. The candlestick signals reveal when it is time to get into a trade and when to get out. The appearance of a candlestick signal indicates that the probabilities of participating in a profitable trade is very high. But always keep in mind, nothing is set in stone. The 'probabilities' of being in a profitable trade being very high means there is also the possibility that a trade will 'not' work. Most investors have an emotional problem of putting on a trade that they consider to be profitable and then having to immediately close out that trade because it did not work. Being mentally prepared for the possibility that a trade might not work, and being able to view the candlestick signals that indicate a failure of a trade, greatly diminishes the emotional attachment involved in putting on the trade in the first place. Learning simple stop-loss procedures allows an investor to move funds out of non-profitable situations quickly. Those funds can be redeployed back into chart patterns that have a high probability of producing profits.

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Candlestick Trading Forum