The Double Bottom – playing the reaction

Walking through the $FAST (Fastenal) stream on StockTwits, I want to break down my initial thought process, and to see how the price action alters my perspective (trade what you see). During my preparation work yesterday, I came across this stock and after my review I elected to put it on my stalk list.

This morning I revisited my list and posted it along with a few others as a place where I would focus for today. For stocks that I stalk, or pay really close attention to, I use the 5 minute chart with a 20 simple moving average and the Accumulation/Distribution indicator.

Throughout the moring the stock has been under pressure, and because I am looking for a bottoming process, I was very interested in the Double Bottom that it made (here is a current chart showing the Horizontal Support line creating the D/B):

Playing the reaction to this test of Horizontal Support was the play and as you can see it was not much of a battle there. The volume print supported the short trigger there – this increases the probability of success.

 

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