Yesterday, I was predicting a bearish reversal in the near term by looking at the negative divergence of the MACD histogram and the signal line of the Dow weekly chart. And today, STI did show some bearish strength that took over the market. Exactly what sort of bearish strength did the STI exhibit today? Should we suddenly go short after 2 months of long positions?
Well, the answer probably lies with the STI performance today.
- The biggest attention grabbing item has to be a gap between Wednesday's candlestick and today's. There is a gap of about 15 points! That is around 0.5% worth of the STI value. Furthermore, studying the 2 months candlestick patterns of the STI, everytime a black(bearish) candlestick appeared, it never appears in a negative gap, except today's. This is the first time a long black candlestick has formed totally below the previous day's ...
