2B bottom/top

Harry · Jan 6, 2003

Can anyone give a short definition of a 2B bottom/top - I have found some examples on the web - it's a kind of a false breakout - but a definition or link would be great.

Thanks a lot!
Harry

NihabaAshi · Jan 6, 2003

Quote from Harry:

Can anyone give a short definition of a 2B bottom/top - I have found some examples on the web - it's a kind of a false breakout - but a definition or link would be great.

Thanks a lot!
Harry

There are several definitions. Some involve price action alone. Others involve indicators alone and others involves both relationship between price and indicator.

The examples (ones you didn't provide any links to) you have are probably good enough definitions.

NihabaAshi

Harry · Jan 6, 2003

Well, I have just found some simple trade examples where a 2B bottom is mentioned (http://www.hardrightedge.com/wizard/tl2.htm or http://www.elitetrader.com/vb/newreply.php?s=&action=newreply&postid=123089)

I trade mainly futures and that kind of false breakouts occur very often - so I was just wondering if there is a more accurate definition of this kind of setup, to backtest some variations to get some more insight.

But thanks anyway,
Harry

Stardust · Jan 6, 2003

It's a variation of Traders Vic's "1-2-3 top/bottom". He provides a clear explanation in either of his 2 books. Basically a double top after a trend run, evidenced by a correctly drawn trendline being violated and price subsequently breaking out of horizontal support/resistance trendlines, prior to anticipated trend reversal.

Breakout · Jan 6, 2003

The "Hard Right Edge" link is pretty close, but like Stardust said,
if you want a complete and accurate definition and examples, read one of the Trader Vic books.

Good luck...

Runningbear · Jan 6, 2003

Have a look at www.dacharts.com

Runningbear

Harry · Jan 12, 2003

@Runningbear
Thanks! That was exactly what I was looking for.

If anyone else is interested, here is the exact link to the definition: http://www.dacharts.com/2b.htm

Harry

inandlong · Jan 12, 2003

Quote from Runningbear:

Have a look at www.dacharts.com

Runningbear

I wonder what the macd looks like then too.

Man, I love that mouse over thing.

I'm presuming the X line was drawn at the low of the bar considered the breakout bar. If that isn't correct, please tune me up.

ddog · Jan 12, 2003

Has anyone been able to code this pattern in Tradestation as a trading system?

I have tried but can't seem to be able to get it to work the way I want.

wally_ · Jan 12, 2003

Quote from Stardust:

It's a variation of Traders Vic's "1-2-3 top/bottom". He provides a clear explanation in either of his 2 books. Basically a double top after a trend run, evidenced by a correctly drawn trendline being violated and price subsequently breaking out of horizontal support/resistance trendlines, prior to anticipated trend reversal.

Good observation. Read his books, at least one of them. He talks about the TA stuff in both of them so reading only one should be enough. They can probably be checked out from a good library or ordered via interlibrary loans.