Using the Time Segmented Volume Indicator to Identify Stock Bottoming Formations
One
of the tougher technical candlestick patterns to determine is when stocks are going to stop
trending down and begin bottoming stock formations. This is especially
important for Swing Momentum 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.
Go watch the Swing Trading Training Video to learn about precision entries and exits, and how to use
leading indicators to enter before price moves.
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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.
Go watch the Time Segmented Volume Indicator training webinar to learn how to Track Dark Pools that trigger High Frequency Trader explosive runs and huge gaps.
Learn indicator crossover candlestick patterns, bottom and top signals, as well as converge and diverge patterns.
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See chart example below with Time Segmented Volume indicator in the bottom
chart window, showing a U Bottom Formation.
The
Time Segmented Volume Indicator is particularly strong 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.
Summary
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Combining
the Time Segmented Volume Indicator 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.
Summary
Adding
the Time Segmented Volume Indicator to the analysis of stocks for Swing
and Momentum Trading can provide additional signal patterns that give earlier
indications of momentum energy building, due to giant Buy Side Institutions using Dark Pool Quiet Accumulation and large
lot Professional Traders buying the stock after that accumulation.
Professional Traders candlestick patterns are far more reliable and consistent than trading with Retail Traders and Small Lot Investors, and finding those patterns is easier when you apply this indicator to the analysis.
Professional Traders candlestick patterns are far more reliable and consistent than trading with Retail Traders and Small Lot Investors, and finding those patterns is easier when you apply this indicator to the analysis.
Go to the Learning Center and watch a wide
variety of training webinars including Bollinger Bands, How to Improve MACD,
Candlestick Patterns, and Technical Analysis.
There
are Libraries for TC2000, StockCharts.com, and MetaStock Users.
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Trade
Wisely,
Martha
Stokes CMT
TechniTrader technical analysis using a TC2000 chart, courtesy of Worden Bros.
Chartered Market Technician
Instructor & Developer of TechniTrader Stock and Option Courses
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