Observed a double bottom with good volume at point B and today the stock broke the neckline (point C) with a breakout gap and significant volume on the breakout day.The prediction is that the stock is going to be bullish for the next few days and it is going to there till it reaches the resistance.Since the market is already in the trending zone,i did not design the trade with the usual double bottom strategy with the stoploss being the bottom line and the target calculated with a risk reward ratio of 1.Instead i decided to keep the low of the bullish candlestick as stoploss and the target being calculated with a risk reward ratio of 1.5 since the market can keep the uptrend until it hits the next resistance level.
, , JISLJALEQS
Thanks for the descriptive observation. i appreciate you time take to narrate your understanding.. This helps other to interact with your analysis. Also it can help you to review later.
The Stoploss can be placed below the GAP or the Double Bottom Low.
Dear sir /madam
Location is very good because it is GAP UP break out from the stand point of two aspects ie range and double bottom. Kindly capture the required period in the chart so that we can give brief logic of the trade plan. SL at the gap is at low risk
I sincerely thank you for this kind of detailed observation. Otherwise both valar and Veda comments enough.