Strong Positive Moves .... a Candle on its own is ....

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Derek  2 Nov 2018

Good Morning,

After the bumpy start, all jets ignited and we had a proper lift off! The HangSeng is even stronger than the US this morning with only Australia lagging. All the Trade-War problems are forgotten for now?

On the chart of the NASDAQ we first get the gap, then the trend and EMA8 line breaks to be followed by the surge. This turn had no significant candles, but only divergence.

You might have thought that I have forgotten about my other favourite, NVIDIA Corporation? NEVER! First we got an engulfing bull candle with divergence. Then a doji broke the trend and EMA8 lines to be followed by the strong positive move. The early key here was the candle with divergence.

Lets do one more. Home Depot made a doji on support with divergence in place. The next candle created a morning star formation. Then we had a shaky break of the trend and EMA8 lines to be followed by a strong positive move.

JSE Technical:
It is very nice to see the JSE following world markets for change. Look how the STX40 consolidated on support with divergence in place before the break.

You might recall when I showed Clicks. After the trend line break, it came back to touch it again before taking off. You often get this pattern with breaks. Also notice the divergence before the break.

a Candle on its own is important, but it is much more importent where it occurs in a cycle. Always check the HeatMaps to see if it occurs in overbought or oversold territory, or on support and resistance lines to decide on the importance.

You must have a fabulous weekend.
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