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Entries in candlestick stocks (5)

TechniTrader Beginner Stock Traders "Bottoming Stock Formation Indicator" 

Enter Stocks Earlier with TC2000 Time Segmented Volume Indicator

 

One of the tougher technical patterns to determine is when stocks are going to stop trending down and begin bottoming stock formations. This is especially important for Swing Traders as most bottoms have periods of Momentum action as energy builds up, due to larger lot buying. This is a form of liquidity taking, which triggers High Frequency Trading action and big Velocity runs.

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Being able to identify when a stock has reached that final low is often challenging when only using traditional stock indicators and price action. When a Trader incorporates more Volume Indicators a final low can often be identified sooner, allowing for time to prepare for the Velocity runs out of a bottom.

One of the best Hybrid Volume Oscillators to use in order to find the final bottom low is called Time Segmented Volume TSV, because it has a tendency to show a bottom V, W, or U pattern since it is a line indicator. Time Segmented Volume also oscillates via a center line, which adds additional easy to read patterns for the beginner to novice trader.

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See chart example below with the Time Segmented Volume Indicator in the bottom chart window, showing a U Bottom for this stock.

Bottoming Stock Formations TC2000 chart - TechniTrader

Time Segmented Volume is a particularly strong indicator because it has all 3 pieces of data in the formula, and is a Cumulative Indicator rather than an indicator based on Moving Averages. This empowers the analysis with stronger signals and far more reliable entries for the Momentum trade. 

Combining Time Segmented Volume with new candlestick patterns such as the “Sandwich Candlestick Pattern” and pre-momentum action, makes it is easy to recognize and allows earlier entries for Swing Traders in bottoming stock formations.

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Summary

Adding Time Segmented Volume to the analysis of stocks for Swing Trading can provide additional signal patterns that give earlier indications of momentum energy building, due to Quiet Accumulation and large lot Professional Traders buying after the accumulation. Professional Traders candle patterns are far more reliable and consistent than trading with Retail Traders and Small Lot Investors. Finding these patterns is easier when you apply Time Segmented Volume to the analysis.

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Trade Wisely,

Martha Stokes CMT

TechniTrader technical analysis using a TC2000 chart, courtesy of Worden Bros.

TechniTrader.com

Chartered Market Technician

Instructor & Developer of TechniTrader Stock and Option Courses

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