Sell Stops Triggered and Absorbed

Here is a nice example of some large sell stops being triggered but being absorbed within a few prices at the low of the day. This is a great signal that 2 things have occurred.

  1. The sellers have puked and can't hold longs any longer.
  2. Attractive price for buyers to make a purchase (with size).

This creates a 1-2 punch for a reversal trade opportunity.

CL stops

Footprint Chart Examples for May 11

Topping Action in Crude Oil