Look For Time AND Patterns:
You probably know by now, that in uptrends, I prefer to step up and buying weakness, not just strength. Doing this requires patience and discipline. When a market (or stock) pulls back it is imperative to be patient and wait for a bottom (or top) to form and not blindly try to pick a top or bottom. The key component in both a bottoming and topping process is time. Remember, both bottoms and tops require time to develop. They also require a pattern to emerge. Only then, am I able to identify a favorable risk/reward entry point.
Most Tops & Bottoms Are Short Term In Nature:
Also keep in mind that most bottoms and tops are short term in nature and it is rare to see major bottoms (Oct 2002, March 2009) and major tops (March 2000, Oct 2007) form. Since most bottoms/tops are short term in nature, here are 3 short term double bottom patterns that are forming after this latest market pullback.