Basing Bottoms Formed by Dark Pool Buy Zones™
One thing that is a constant in the Financial Markets and especially in the Stock Market over the past few years is change. Everything about Technical Analysis is changing. It is often hard for Retail Traders who trade from home and Technical Traders who are Semi-Professional Traders making a high income from trading stocks to keep up with all the changes.
The candlestick chart example below is a low-priced stock, and it is often within the price range that beginners need to study or lower capital base traders prefer. The all-time high is around $41, so it is a super bargain at $6–$7 for giant Buy Side Institutions using Dark Pools.
One of the new Bottom Formations for Technical Traders that develops when Dark Pool Quiet Accumulation is underway is what is called a “Basing Bottom”, which TechniTrader Staff identified and have tracked and studied for several years now. It is usually a short-term pattern that concludes with a sudden momentum accelerated price run upward.
Indicators that are stock Volume-based offer earlier convergence and divergence signals and confirm the presence of Dark Pools. The key to recognizing these patterns as a Basing Bottom is to understand the goals and intent of the giant Buy Side Institutions who use Dark Pools and Twilight Pools to hide their huge-lot orders.
This allows traders to enter the stock before price runs or gaps up and runs. Recognizing early signals in candlesticks and indicators is crucial to being able to use the Basing Bottom for Momentum Trading runs.
The giant Buy Side Institutions’ intent of the purchase:
- To buy a stock at a bargain price before others realize the company is turning itself around, and in future Earnings Reports, the company will have strengthening Fundamentals.
Martha Stokes CMT
TechniTrader technical analysis using a StockCharts chart, courtesy of StockCharts.com
Chartered Market Technician
Instructor & Developer of TechniTrader Stock & Option Courses
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