Evening Star CONFIRMED!
Yes, even candlestick formations as strong as an evening star formed around the 30MA within the framework of an intermediate bear trend needs to be confirmed before one can be truly committed to a trade (Ok, even so, you won't be 100% committed because there simply isn't anything that's 100% in the market. So, how do you deal with such risk? This is why professionals are not called "traders" but "risk managers". We adjust the amount of fund commitment according to the assessed risk. Don't know how much of your fund to use under each risk profile? Join my Master's Stock Options Picks service and leave that to us!).
So, what does it mean for a candlestick formation to be "confirmed"?
A formation is "confirmed" when the ensuing days of trading actually move in the direction pointed by the formation. That is the line that determines if the formation/signal is a real one which will trigger a continuation of a trend or a trend reversal. So, it can actually be dangerous jumping straight into a signal without confirmation no matter how strong the signal looks.
With today's down day, the evening star created two days ago is now confirmed, which means this is the high probability start of a more significant downwards movement. Now, significant in my world means any move that takes the market in one direction 5% or more, regardless of how many days it takes to do it. Even if its a huge one day move.
Supporting today's move was more disappointing economic data in the retail sales and manufacturing sectors as both Redbook and Richmond Fed turned in worse than expected. Housing prices took an about turn but that didn't convince investors that the housing sector is getting better either due to the recent numbers. Bond yields dropped across the board as investors returned to the safety of bonds and total equities put call ratio persisted in the bearish region.
If you have been following my every report as a subscriber (Yes, I only publicly post my report every other day at best but paid subscribers get my reports DAILY for LIFE... sign up now! Only $99 for LIFE! And it takes only one winning trade to make that back and MORE, you know it!), you would know that I hadn't qualified any of the days recently, no matter positive or negative days, as truly bullish or bearish due to conflicting internals. Today, however, is a truly bearish day where generally everyone thought and behaved bearish, no conflicts. Such a strong follow up only tells me that there are more to come, which is why I have already prepositioned my Master's Stock Options Picks subscribers with bearish position over the past few days. (Yes, in most cases, being PRE-POSITIONED makes the difference between whether you profit from the same move or are you too late! Join my Master's Stock Options Picks service and stop getting in only when its too late!)
I am more convinced than ever that this is the start of the 2016 market crash which myself and many other experts have been predicting for a long time. I am just one step away from dialing my market crash timer all the way up to RED.
Market Crash Timer: ORANGE
For now, the market turns a short term bear trend within an intermediate bear trend and primary neutral trend.
So, what does it mean for a candlestick formation to be "confirmed"?
A formation is "confirmed" when the ensuing days of trading actually move in the direction pointed by the formation. That is the line that determines if the formation/signal is a real one which will trigger a continuation of a trend or a trend reversal. So, it can actually be dangerous jumping straight into a signal without confirmation no matter how strong the signal looks.
With today's down day, the evening star created two days ago is now confirmed, which means this is the high probability start of a more significant downwards movement. Now, significant in my world means any move that takes the market in one direction 5% or more, regardless of how many days it takes to do it. Even if its a huge one day move.
Supporting today's move was more disappointing economic data in the retail sales and manufacturing sectors as both Redbook and Richmond Fed turned in worse than expected. Housing prices took an about turn but that didn't convince investors that the housing sector is getting better either due to the recent numbers. Bond yields dropped across the board as investors returned to the safety of bonds and total equities put call ratio persisted in the bearish region.
If you have been following my every report as a subscriber (Yes, I only publicly post my report every other day at best but paid subscribers get my reports DAILY for LIFE... sign up now! Only $99 for LIFE! And it takes only one winning trade to make that back and MORE, you know it!), you would know that I hadn't qualified any of the days recently, no matter positive or negative days, as truly bullish or bearish due to conflicting internals. Today, however, is a truly bearish day where generally everyone thought and behaved bearish, no conflicts. Such a strong follow up only tells me that there are more to come, which is why I have already prepositioned my Master's Stock Options Picks subscribers with bearish position over the past few days. (Yes, in most cases, being PRE-POSITIONED makes the difference between whether you profit from the same move or are you too late! Join my Master's Stock Options Picks service and stop getting in only when its too late!)
I am more convinced than ever that this is the start of the 2016 market crash which myself and many other experts have been predicting for a long time. I am just one step away from dialing my market crash timer all the way up to RED.
Market Crash Timer: ORANGE
For now, the market turns a short term bear trend within an intermediate bear trend and primary neutral trend.
posted by Jason Ng at 7:05 PM
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