You can see this more clearly by looking at the flow of the candlestick bodies leading into the critical day. Members had advance warning that a trend reversal may occur and begin to watch for other signs and indications of a reversal. The trendline penetration that occurs a day after the critical day confirms that demand is faltering. This combined with a strong understanding of the economic and fundamental forces that ultimately dictate long term trends in price is a strong navigational tool in the short term market. Example 2 shows the series of critical days given to members as the year 2000 got under way.
Every blue dot is a successful critical day.
The red dots are failed critical days. To the right technical studies are examined in more detail to provide a sense of conformational evidence for traders of the critical day. Click on any of the terms to take a closer look at a technical discussion on that topic. All formations, patterns, indicators and technical tools fail at various times and so should only be used to build a body of evidence in forming a trading decision rather than being solely relied upon. There are a number of valuable studies that lead to intuitive understandings about price and volume but a strong compliment to technical analysis is an understanding of the trends and changes in the fundamentals and economic activity that ultimately lead valuation levels in the markets.