The World's General Store Doesn't Sell Candlesticks Like This One
Thursday, August 13, 2009 | William Kurtz Is this Spam?Today was a crazy day at the races for Wal-Mart shares. They gapped up $1.35 or on opening, promptly descended almost back to yesterday’s close, and spent the rest of the day climbing back up the hill to the opening price. At the end, prices were up $1.37 on the day, and all of the fulminations left behind a “Hanging Man” pattern showing a close spread between the open and the close, near the top of the day’s price bar, with a very long “tail” below. This is just about as dramatic example of the “Hanging Man” as we are likely to see.
Now that it has appeared on the scene, what do we do with it, or about it? The first thing we do is to respect it, because it has bearish implications as a Candlestick reversal pattern, but it needs a lower close tomorrow for “confirmation” of bearishness. It is particularly interesting because the price bars of the NASDAQ 100 and of the NASDAQ Composite today were nearly exact duplicates of Wal-Mart’s, so it has company.
We will keep a close eye on all three of these tomorrow, especially to see whether any of them produces a lower close.
William Kurtz
August 13, 2009
