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January 11th Market Wrap-Up

Because candlestick analysis is based upon probabilities that have resulted from signals and patterns of human nature, an investors returns can improve dramatically. Simple scanning techniques allows investors to identify the strongest bullish or bearish charts. In an uptrending market everybody usually makes money. However, many investors do not make great returns because they have some positions that are trading positive while others are trading lower. What is the normal human reaction? They are waiting for the positions that are trading lower to turn around and go up, eventually improving the overall returns. What is the normal trading process? When they get ready to sell a winner, they get ready to sell a loser to help offset their gains. Their hope is that when they reinvest those funds, they do better. Candlestick investors can dramatically reduce the mediocre returns of that thinking. Analyzing candlestick charts create a strong self-discipline. Logic says if the markets are heading higher, the portfolio should consist of trade positions heading higher. The graphics of candlestick analysis will reveal which trades are not working. The built in discipline aspect of candlestick's instigates the closing of the trades that are working and immediately reestablish those funds into trades that are working. All boats will rise in a rising tide. Candlestick analysis will make the boats rise a lot faster.

Candlestick patterns are created by human nature building up investor sentiment. Frypan bottom patterns and J-hook patterns not only result in high probability profitable trades but the results of those trades are usually much more profitable than merely a rising trend during a rising market. This is based upon one simple fact.


Good Investing,

The Candlestick Forum Team

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