Thursday, October 20, 2022

♟ Beware: The "Black Candle of Death" Just Appeared

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"In my experience, a black candle is a sign of exhaustion."

Bryan Bottarelli, Head Trade Tactician, Monument Traders Alliance

I'd like to share with you an important message that I posted inside The War Room yesterday.

At 12:32 p.m. ET, I said...

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For proper context, consider what was happening at the time of this post...

Before the open, United Airlines (UAL) reported fantastic earnings.

The stock was up 5.3% on an upbeat earnings forecast for the current quarter amid a continued surge in travel demand.

Not only that...

Before the open, Netflix (NFLX) popped 12.2% after reporting that it had added 2.4 million subscribers during its latest quarter - more than twice as many as predicted (if you recall, NFLX had lost subscribers in the previous two quarters).

However, despite these two bellwether companies reporting strong earnings, the market still could not hold an early gain.

In fact, at the time of my post above, I saw a "Black Candle of Death" appear on a chart of the SPX.

It looked exactly like this...

See the Candle Chart

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