The market action yesterday in the major indices and many other markets has to be viewed as negative. The major indices all created what are called bearish engulfing patterns.
Bearish engulfing patterns occur when the market opens higher than the previous day's close and then closes below the low of the previous day. The main body of the candle totally engulfs the body of the previous candle. I will visually explain this phenomenon in today's video update. If you are interested in candlestick charts, I have a PDF titled, "17 Money Making Candlestick Formations." You can download the PDF here.
Should the indices closed lower than the close we saw on Thursday, it would confirm a top in the market and indicate further weakness.
I may be sounding like a broken record, but the reality is, December has turned out to be an extraordinarily volatile month. Historically, December tends to be choppy and volatile, but this year is proven to be the granddaddy of them all.
Many of the Trade Triangles are in retreat indicating that a sidelines position is in order as the major trends are being weakened by the intermediate trends, many of which have turned negative.
There are very few trading days left in December and my advice is to kickback and enjoy the holidays and read MarketClub's 12 Days of Trading Tips.
In today's video, I will be looking at the bearish engulfing patterns in all the major indices along with other views and commentary for the other markets I track.
Have a great weekend and enjoy the season!
Every success with MarketClub,