The last trade setup did not trigger and last Friday saw a strong move to the downside. Any pending trades based on previous analysis should now be cancelled.
Todays open candle opened with a gap to the downside and then continued into a strong resistance zone. Then price moved swiftly up from that zone and closed the open gap. Experienced trades could have taken advantage of the this movement and made a nice profit.
When a candle opens below the close of the previous day and then closes up into the previous days candle AND closes 50% or more up into the candle it is a 'Piercing Candle'. The piercing candle is another japanese candlestick formation and is considered a reversal candle especially when bounceing up off of a resistance level. The further past 50% the candle goes into the previous candle the stronger the signal is considered. Of course if it goes beyond the previous candle open we will have a 'bullish engulping' candle.
So we will see what the close of this days candle will bring and then make a decision on what play to make if any.
Of note also is that the we are now starting not only a new day, but also a new week and indeed a new month. At this time we should consider the weekly and monthly charts for candlestick formations that may signal us to upcoming price action :-)
