December 21st Market Wrap-Up
Is the market about ready to reverse? Is there more upside in this market trend? Should we be taking profits? These are questions that many people ask when they do not utilize or understand what the candlestick charts are revealing. A trend will move one way or the other based upon investor sentiment. Candlestick signals and patterns are merely the repeating of what investor sentiment does time after time. Do they work every single time? Obviously not but they do work a high percentage of the time, otherwise the patterns would not be recognized as high probability trades set ups. Again, prices move with predictable pattern results because investor sentiment is usually occurring over and over with predictable results.
The overall market trend can be analyzed much more accurately when candlestick signals and confirming indicators are applied to the visual analysis. The best confirming indicator is the T line. The most powerful price/trend analytical combination is candlestick signals and patterns that are the graphic depiction of human nature. Add the T line, which is a a natural support and resistance level of human nature. The combination of these two chart indicators produce an extremely high probability trades set up. The T line provides a support or resistance level that will easily visually confirm whether a trend is reversing. Simply stated, a candlestick buy signal and a close above the T line will produce an uptrend until a candlestick sell signal appears and a close below the T line. This combination is an extremely high probability trade analytical tool. It keeps investors from being whipsawed in and out of positions. It keeps investors from having emotional trade decisions.
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The Candlestick Forum Team
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