Looking Back

Would you buy this stock? Where would you place your stop if you went long?

How about this one? After going down, it consolidated, a series of reversal candles (dojis and spinning tops) were formed, and then broke the neckline of the consolidation.

On this last chart, we see a clear hammer was formed after a big move down, it consolidated, and broke above the consolidation area.

These charts look like good longs with relatively low risk. Stop losses can be placed below the lows and then adjust the stops if the stocks go up. Perhaps you recognized these opportunities and took these trades. I have been playing the long side very cautiously so I just took small long positions. However, when I've gone short, I've been taking larger positions because I don't trust this rally. In the future I will try to trade what I see and not what I feel.

We can see that the charts above were indeed great opportunities to take long positions, even if we just held them for a couple of days.