{"id":6253,"date":"2010-08-02T19:04:25","date_gmt":"2010-08-02T23:04:25","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=6253"},"modified":"2010-08-02T19:07:44","modified_gmt":"2010-08-02T23:07:44","slug":"the-bottoming-process","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/the-bottoming-process","title":{"rendered":"The Bottoming Process"},"content":{"rendered":"<p>There is a lot of money to be made in a stock that has been beaten down. \u00a0Generally, after a stock has been destroyed for some fundamental reason it will have some type of longer term bounce where traders can gather information from its price action over the course of several weeks. \u00a0In the case of RIG it bottomed back on June 9th around 42. There was very heavy volume on both June 8th and 9th leading to what appeared at the time to be a longer term bottom.<\/p>\n<p>During the next seven trading days RIG bounced to the mid 50s. \u00a0It then traded down to 45.75 prior to bouncing up to the mid 50s again. \u00a0In the world of technical analysis this is called a &#8220;higher low&#8221;. \u00a0This higher low was violated two weeks ago on July 23rd when RIG closed at 45.23. \u00a0Things were not looking so good. \u00a0But the following Monday after trading below Friday&#8217;s low it reversed course and closed above 46 on good volume. \u00a0This caught my attention.<\/p>\n<p>It made higher highs for two more days but failed at 47.96 on Wednesday. \u00a0I set an alert for 47.90 in anticipation of a possible move through 48. \u00a0When the alert was triggered this morning sellers rejected RIG at the 48 level the first time it traded there. \u00a0But each time RIG struggled close to 48 the pullbacks became shallower and shallower. \u00a0Buyer were gaining confidence.<\/p>\n<p>Once above 48 RIG became a Trade2Hold. \u00a0The next major resistance was around 52 but based on RIG&#8217;s level of volatility I wasn&#8217;t really expecting a move much higher than 50 for today. \u00a0I took sales at 49.20 and 49.60 and got flat at 50.80. \u00a0 I \u00a0will look to buy my shares back on a pullback tomorrow to around 49.70.<\/p>\n<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2010\/08\/rig-bottoming.png\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-medium wp-image-6262\" title=\"rig bottoming\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2010\/08\/rig-bottoming-300x210.png\" alt=\"\" width=\"300\" height=\"210\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2010\/08\/rig-bottoming-300x210.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2010\/08\/rig-bottoming.png 500w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>There is a lot of money to be made in a stock that has been beaten down. \u00a0Generally, after a stock has been destroyed for some fundamental reason it will have some type of longer term bounce where traders can gather information from its price action over the course of several weeks. \u00a0In the case of RIG it bottomed back &#8230; <a href=\"https:\/\/www.smbtraining.com\/blog\/the-bottoming-process\" class=\"more-link\">Read More<\/a><\/p>\n","protected":false},"author":143,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,8,3,15],"tags":[1237,1238,471],"class_list":["post-6253","post","type-post","status-publish","format-standard","hentry","category-general-comments-2","category-steven_spencer_steves_blogs","category-technical_plays","category-trading_theory","tag-bottoming","tag-process","tag-the","no-post-thumbnail"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.1.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>The Bottoming Process | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/the-bottoming-process\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Bottoming Process | SMB Training\" \/>\n<meta property=\"og:description\" content=\"There is a lot of money to be made in a stock that has been beaten down. \u00a0Generally, after a stock has been destroyed for some fundamental reason it will have some type of longer term bounce where traders can gather information from its price action over the course of several weeks. \u00a0In the case of RIG it bottomed back ... 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