Mish’s Daily

The 4-Step Formula to Spot a Stock Bottom Early

February 15, 2026

How do you know when a stock or ETF has truly bottomed?

Not guessed. Not hoped for.

Actually bottomed.

There’s a simple signal professional traders watch for — and when it appears, it often marks the moment sellers are exhausted and buyers quietly step in.

First, we want to see a new 60-day low.

That fresh low matters. It shakes out weak hands, triggers emotional selling, and creates what traders call capitulation. Without that flush, a real bottom is less likely.

But the low alone is not enough.

The next step is the real tell:

the very next day, price must break above the prior day’s high.

That’s the shift. Sellers pushed price down — but buyers immediately took control. When price can reclaim and exceed that prior high so quickly, it signals demand has returned.

Video here

https://youtube.com/shorts/T10CWO9CES0?si=9OEEosk5QZHqGby7

More Daily analysis here

https://marketgauge.com/resources/mishs-daily/the-4-step-formula-to-spot-a-stock-bottom-early/