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How to Catch a V-Bottom in Crude Oil

Posted by David Bean on

I see so many V-Bottoms and market reversals in this mean reverting market. You are not supposed to catch falling knives but that is exactly what works at times in this type of market. 

How do you get in at the turning point in a market that is falling (or rising) fast? When I study the charts, it is difficult to find that low risk turning point.

There is one pattern that I have found that has the tendency to capture these V-Bottoms. It isn't perfect as there is risk and there are losing trades but the Gap Fill and Reverse pattern gives us the opportunity to capture some picture perfect trades.

We show today's trade and how it is setting up nicely for one of those picture perfect trades. The trade is still on so it can still go against us since Crude Oil can move fast at the end of the day, but we look at the big picture of what this strategy has done with performance summaries below the video.

We will also be doing a Tradestation hosted webinar in a week from tomorrow at 4:30 pm EST on this very strategy. You can sign up here. Tradestation Webinar Sign Up

(This particular trade reversed at the very end of the session and was down 80 points)Tradestation Performance Summary
9/5/2006 - 1/17/2017 (intraday trade)
No Slippage or Commission (Using book settings)

Tradestation Performance Summary
1/2/1987 - 9/5/2006 (Pit Session)
No Slippage or Commission (Using book settings)

Get the Book Here

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