A bearish Reversal Warning Pattern has recently arisen in the Dow Transports Index. This pattern is known as the “Osaka Clipper,” and is a variation of the well-known Candlestick “Evening Star” reversal pattern.
The “Evening Star” appears at the top of a long price advance. It is characterized by a tall white candle, signifying a strong Up day; then a Candle (the “Star”) which has a small “Real Body” (the price distance between the Open and the Close), signifying a degree of indecision, located at or near the top of the tall white candle; and then a tall black Candle, signifying a strong Down day and a reversal of trend.
The “Osaka Clipper” is like the “Evening Star,” except that it has two “Stars” between the tall while Candle and the tall black Candle. It contains much of the “DNA” of the “Evening Star,” and its bearish implications are the same as those of the “Evening Star.”
Following the appearance of this Candlestick Reversal Warning Pattern on January 6, 2012, we can reasonably expect that prices of the Transports Index will decline.
William Kurtz
http://www.CandlesticksOnSteroids.com
