The "Osaka Clipper" Candlestick Pattern Comes Calling
Tuesday, April 21, 2009 | William Kurtz Is this Spam?On February 5, 6, 9, and 10, 2009 there appeared in the Dow Industrials a four-bar variation of the bearish “Evening Star” Japanese Candlestick reversal pattern which led to a 1400 point decline over the ensuing 17 days. The same four-bar Daily chart pattern was completed yesterday, April 20, in the Dow Industrials,, the S&P 500, 600, and 100, the Russell 2000, and (in modified form) in the NASDAQs.
The classic Japanese Candlestick “Evening Star” pattern consists of only three bars, not four. To the best of my understanding, the literature does not recognize any such thing as a “four-bar variation” of the Evening Star.
Nevertheless, based on the April example of recent history, the pattern may have predictive capability. We will search now for other examples which may have occurred in the past. I suggest that the pattern is worthy of recognition. It is sufficiently particular and instantly visually identifiable that it ought to have a name of its own. I call it the “Osaka Clipper.”
It is yet to be seen whether, this time, it will be followed by a notable decline in the Indexes. The 90-, 60-, and 30-minute charts yesterday show “Inverse Hammer” Candlestick patterns, which can have bullish connotations if they are followed by a higher close. On that basis alone, it is reasonable to expect that prices in the Indexes may immediately retrace somewhat. Nevertheless, our Indicators reveal that there is substantial downward unrelieved pressure on prices from above that a significant retracement of the rise in prices which began on March 10 is within the realm of possibility.
We will be watching to see whether this example of the “Osaka Clipper” is followed by a repetition of its February performance.
William Kurtz April 21, 2009 http://www.candelaabra.com
