The 20 Day View

I like the 20 day candlestick chart made up of 4 hour candles. It is a chart of approximately one month of trading days. The chart below begins on the left side with prices on May 5th and goes to todays prices on the right side. It can be seen that on May 6th there was a high in the market Then in the middle of the chart on May 19th is the highest high. And finally, last Thursday on May 29th was a lower high. Those are the highs. The lows are as follows: on May 9th and May 27th.

We have here now a series of lower lows and lower highs. This is our definition of a downtrend. Even though it is a small series, two lows and two highs, it is enough to say that the former uptrend has changed and now we have a downtrend. Also note that the fast band of moving averages has crossed below the slow band.

What does this mean? Since the real trend is determined by the daily chart we will have to watch the daily chart to see if it makes a similar pattern as shown here with the ½ day chart. If it does then the trend is confirmed down and sell in May and walk away holds true. If not, this could be a period of consolidation before another move to the upside. We will just have to wait and see. Click on chart to enlarge