This audio lecture along with the downloadable PDF workbook covers and discusses practical trading approaches, including stop placement and trailing levels, risk parameters, money management and the psychology of trading any market with Japanese Candlesticks. The information derived by using this approach can directly influence the day-to-day decision process, which can enhance your awareness of the markets. You will learn the basics of Japanese Candlestick charting, as well as how to combine them with Western technical tools such as trend lines, DeMark Sequential, moving averages, stochastics, and may other standard technical tools.
Developed over three hundred years ago, this method of technical analysis is still relevant and an exceptional addition to Western technical analysis. By combining both approaches to market forecasting, one is able to take the best from both schools. Gary Wagner believes that the outcome from this combination is capable of extending the benefits of any methodology.
We have had a very good run in the stock of Netflix (NASDAQ:NFLX) and the question now is, has Netflix topped out?
There is increasing evidence that Netflix is having problems over the $300-$310 area. With a lower close in this stock today, it will confirm that it has put in an intermediate top.
Yesterday, Netflix (NASDAQ:NFLX) put in a Japanese candlestick pattern known as "a dark cloud cover." This is confirmed as a top if the market closes lower today, September 17th. Candlestick patterns can be very powerful. This is not to say that Netflix has put in an all-time top, but rather in the interim the market has stopped going up and is probably going to see a pullback.
Pullbacks are always interesting and I like to use our Fibonacci retracement tool to measure them. In 2013, most of the pullbacks were in $30-$40 range. Measuring from the recent high of $314.18 on September 11th and subtracting $40, takes us down to $274 area. Coincidentally this is very close to a 50% Fibonacci retracement if we measure from the recent high on September 11th to the low seen on July 25th at $239.91.
I have two other concerns with Netflix (NASDAQ:NFLX). We are at a cyclic high and the MACD is beginning to roll over, which is similar to what happened in the May and July periods.
Please be aware I am not recommending shorting Netflix, as the longer-term trend for Netflix remains positive and I can see this market doing well longer term as it dominates the space of streaming video and home entertainment.
Let's watch today's close in Netflix very carefully. A close below the $301.13 level will represent a new 5-day low close for this stock.
This is just a heads up that Netflix may be running into some headwinds and profit taking.
Please feel free to leave a comment or your own view on the stock.
Have a great trading day, Adam Hewison
Evening doji star -- the same as an evening star except the middle candlestick (i.e., the star portion) is a doji instead of a small real body. Because there is a doji in this pattern, Marketclub considers this pattern to be more bearish than the regular evening star.
The market action for Apple on Tuesday created an Evening Doji Star. What this means is that Apple has put in a top.