Followers

Thursday, May 1, 2008

Double Bottom 1 Minute Trades:






Capitulation selling is the key to this pattern, as it sets the stage for the eventual reversal. Buy the successful retest.

5 comments:

Trader M.D. said...

Nice.

I tried some bottom phishing in AGU & FSLR. Luckily I got out with out being hurt too much, but I'm still a newb at your style of trading.

Just out of curiousity. Do you use stockcharts to trade with?

Also stop by my blog and check out my V trade. I'm not sure if my comment went through on the Visa post.

Cheers.

Bluedog said...

Stewie,
How do you screen for your double bottoms? Do you randomly come across them out of your monitor list or do you have an active screening tool that alerts you as it occurs?

-BD

אחד מהגברים השמנים said...

same as BlueDog. how do you find it?

Stewie said...

hi guys. i am an old school trdaer i guess. I don;t use scanners. I just track 20-30 stocks and i am always visually scanning. i use stockcharts.com mainly to track my bigger watchlists. The smaller watchlist i put on scottrader. I add and remove stocks daily depending on level of interest. The key to the double bottom trades, is to spot some type of climax selling to create an oversold condition then you wanna buy a retest and b/c you are buying while the stock is 'oversold'. the risk/reward is in your favor and you are buying in the midst of 'panic' as badly timed longs wanna exit thinking the lows are about to break and too eager naive shorts who get short thinking that the second test of the lows will break. But we buy expecting a reversal and the stage is set, either we reverse almost immediately or get get stopped out a small amount below the lows. But you need that CLIMAX SELLING! I use mainly 1 min. charts for this. works on all timeframes. oh, a very good example of this scenario was the recent bear market lows that took place on all US INDEXES. just understand the psychology behind a climax selling and a retest, the retest of the climax lows are even scarier then the actual first low. You wanna buy that fear guys! AM I RIGHT???

good luck.

Bluedog said...

Thanks Stewie. I'm just starting to use the 1 min chart and it's helpful. It's good to switch from macro to micro view, especially on quick turnarounds, double bottoms, overselling, etc. How about that V today?! I wish I had caught that morning short. I got a little off the rebound though so no worries.

Cheers,
BD

Blog Archive