Japanese Candlestick Pattern of CML HealthCare(TORONTO:CLC-UN.TO)-Part 1-

Written by light Thursday, 11 February 2010 23:37

We will try to predict the direction of the CML HLTHCARE price (CLC_UN.TO, $12.40) for the coming days by using the power of the Candlestick Japanese Charting Techniques. Can the wisdom of the Japanese Candlestick Patterns help us answer the following question: Is the current downtrend of the CML HLTHCARE price already at the bottom? Please find the answer below:

candlestick-japanese-charting

1) Japanese Candlestick Bullish Hammer for CML HLTHCARE

On Mar 05, 2010, the price of CML HLTHCARE formed a hammer signal with the following characteristics:

- Small body

- No upper tail

- Long lower tail

Because the stochastics are in the oversold condition and the volume during the hammer signal is very high, there is a big chance that the downtrend has already stopped and that more buyers are coming into the market.

2) Japanese Bullish Engulfing Signal for CML HLTHCARE

On Mar 08, 2010, the price opened low, by comparison with the previous close, which is considered as a weak opening in candlestick charting techniques. However, the price closed higher than the previous high and formed thus a bullish engulfing signal. With the stochastics still in the oversold condition, this signal shows that the bull is taking control. This situation was confirmed today with the small bullish candlestick that closed above the bullish engulfing pattern.