TheGladiator ... these sorts of candlestick patterns are signals of changes in sentiment, rather than charting signals to determine targets. Rookies will often buy stocks at the wrong time, ie; at the end of the run as the SP is becoming exhausted. Then sit in agony as it retraces, often selling at a loss etc. However, if buyers savvy in TA are looking to enter, then signals like these become buying signals. They often show that sellers have stopped, and buyers are mopping up cheaper shares. There is a "third" signal though, and that will be today's open. If it is strong (up), then more buyers and traders will move in, hopefully taking it to the next level.
As for plotting targets. I wont go there. There are some pretty good chartists here on HC that ply their knowledge. I tend to follow market caps, compare peers, and other fundamentals of the projects, to determine what I think is a fair target. At this stage CXO is trading at a discount to it's peers. I sold ADV some days ago at the highs because IMO the MC had overshot. While on the other hand CXO was trading at a third of ADV's MC. Crazy! ADV has retraced, and CXO is advancing, yet still under half the MC. So I have added more CXO for that reason.
Disclaimer ... I am very very bullish on the lithium outlook, but very distrustful of the market itself. We are also entering the Danger Zone of April & June, when the stock market traditionally slows, and spec stocks retrace. I am not holding anything long-term, and will move to protect capital over the next two weeks.
PS ... the reverse of the Engulfing Candle is also true. IE; a Bearish EC. That obviously signals a drying up of buyers, and and increase of profit-takers, marking a change in sentiment, and a start of a retrace.
