Tweezer Bottom in Trinity Industries

Published on Friday, 20 August 2010 00:54 Written by TradersHuddle Staff

New York, August 20th (TradersHuddle.com) - Shares of Trinity Industries, Inc. (NYSE:TRN) ended the trading session lower by $0.65 or -3.58% from its previous close. Trinity's price action developed what can be considered a reversal pattern in the form of a tweezer bottom, which is a candlestick pattern that is usually formed at the end of a downtrend. The tweezer bottom is considered a reversal pattern, so traders will need to monitor the the price action for confirmation.

Trinity Industries, Inc. (NYSE:TRN) manufactures transportation, construction, and industrial products. Its products include tank and freight railcars, inland hopper and tank barges, highway guardrail and safety products, ready-mix concrete, and other products. Trinity also leases railcars and other products. The Company markets its products around the world.

Traders looking for an entry in Trinity Industries can use the tweezers as a good reference point to establish the long position, as the pattern provides defined risk by giving a good reference point for support.

Traders are always looking for tweezer bottoms as they give an entry with a small risk defined, they are a leading indicator that provides an alert for a trend reversal or stabilization. The tweezers imply that bears or sellers were not able to push the stock lower, therefore providing the opportunity to look for a bounce. Below an example of Tweezer Bottom reversal patterns: