- haDelta reversal + crossover at support
- A heikin-ashi reversal candle (Note: Use any trailing-stop to protect against grey swans)
- Despite the extended price advance, haDelta shows weakness
- Bullish but weak
- Close to the apex of the consolidation triangle
- Bullish and undecided
- Comfortable vis-a-vis its trailing-stop
- Despite the sustained uptrend, the haDelta :: SMA(3) bullish crossing offers indications of a strong trend ahead
- Difficult to overcome the haDelta resistance
- Caught inside a medium-term consolidation (haDelta is inside an ascending triangle)
- Caution: haDelta is approaching the first resistance level.
Apple weekly chart (see below)
- Waiting for a resolution of the bearish Head-and-Shoulders following a sustained long uptrend
- Price objective: 320 (based on H&S characteristics)
- The thickness of the Ichimoku cloud in the next 13-15 weeks suggests a resistance difficult to overcome
- Note the change of trend 26 weeks in the future on the Ichimoku chart: Usually, such points warn about a strong trend to develop during this time
- The haDelta average SMA(3) was negative (yellow area)
- haDelta and SMA(3) failed to become positive (bad sign)
- Failures to go above the oscillator’s resistance (50-60 area) = Weakness
Multiple and independent indications for market resistance:
- Resistance #1: The reaction hits 50% of the segment September high – November low.
- Resistance #2: haDelta hit resistance area
- Resistance #3: The smoother haDelta and its short average turned at resistance
Conclusion: Charts don’t lie. Heikin-ashi helps to read them better.
If you are not using heikin-ashi yet, you probably missed at least +45%:
Research in Motion $RIMM from $8.23 (Oct 5) to $11.98 (Nov 26).
- Ready to consolidate (haDelta is back at past resistance)
- In most cases, the first close above the Ichimoku cloud signals a bullish trend ahead (trailing stop is a must!)
- Double resistance: Ichimoko cloud and haDelta
- Note again and again (and again) the result of a crossing haDelta :: SMA(3) neat or at zero