Double Trouble

Key takeaways · 5

1. 01Double Trouble is today’s close divided by the lowest low of the trailing 252 sessions (about a year). A reading of 2.0 means the stock trades at twice its 52-week low.
2. 02The screen, from Pradeep Bonde’s Stockbee work, fires at 1.8 and up: the stock is at least 80% above its yearly floor. The premise: a name that has already made a large, recent move off a bottom has demonstrated it can travel.
3. 03It measures how far a stock has come, not how fast it is moving now. Double Trouble says nothing about whether the move is still alive, so pair it with Trend Intensity 65 to separate "extended" from "still going."
4. 04The ratio’s weakness is its denominator. A stock that spiked and has been falling for months can still read high, because the 252-day low is unchanged. Relative strength and a fresh acceleration read guard against that.
5. 05In the terminal, dt runs the screen with Bonde’s 1.8 default and shows the raw ratio in the score column. dt rs>90 narrows it to names that are also strong against the universe.

The screen is part of Pradeep Bonde’s Stockbee toolkit, built around his central claim that stocks make most of their gains in short momentum bursts and that the job of a screen is to surface names already in motion. Double Trouble is the bluntest expression of that idea: rather than model a trend, it just measures raw distance from the bottom and trusts that a large, recent move is itself information.

The logic is survivorship in the useful sense. A stock does not travel 80% off its low by accident. It takes sustained buying, usually institutional, over weeks or months. The move is the evidence. Double Trouble does not ask why the buyers showed up; it assumes that if they moved the price that far, they are worth paying attention to, and it ranks the whole universe by how much they moved it.

The screen pairs naturally with the rest of the family. On its own, distance-from-low is a coarse read; combined with an acceleration screen and a breakout day, it becomes one leg of the "extended, accelerating, thrusting" picture that is much harder to fake than any single number.

Take a stock that bottomed at $8.00 during last autumn’s selloff. Over the following eight months it based, broke out, and ran. Here is how its Double Trouble reading walks up as the move develops.

At the low, close $8.00, 252-day low $8.00: reading 1.00. Dead at the floor. At $11.50 after the first leg: 1.44, moving but under the 1.8 line, so the screen ignores it. At $14.40: 1.80, and it just cleared the threshold and appears on the screen for the first time. At $20.00: 2.50, firmly extended. At $28.00 near the eventual top: 3.50, a very high reading that, on its own, tells you the stock has traveled a long way but not whether the move has more left.

The walk illustrates the screen’s honesty and its limit. It caught the name at 1.8, roughly 80% off the low, which is neither early nor late. And its highest readings (3.5 here) arrive near the end of the move as often as anywhere, because the ratio keeps climbing right up until price rolls over. A high reading tells you where the stock has been, not where it is going.

Three reads get called "strength," and they are not the same. Double Trouble measures distance from the 252-day low. Modified Double Trouble (MDT) measures distance from the 126-day average, the recent trading mean rather than the yearly floor. Relative strength measures return against the whole universe, so it can be high even when a stock is only modestly above its own low, as long as it is beating everything else.

The differences are practical. A young name six months off an IPO base has no 252-day low to divide by, so Double Trouble returns nothing, while MDT and relative strength both see it fine. A name that doubled off last year’s low but has since drifted flat shows a high Double Trouble and a middling MDT, because it is far from its floor but close to its recent mean. And a defensive stock grinding to new highs in a weak tape can post strong relative strength while its Double Trouble stays low, because it never fell far enough to have a distant floor.

None of the three is "best." They answer different questions, and the reason to run more than one is that agreement between them is more informative than any single reading. Double Trouble’s specific contribution is the full-cycle move off a bottom, the thing relative strength and MDT both partly miss.

The denominator is the trap. Double Trouble divides by the lowest low of the last year, and that floor does not move when the stock falls. It only resets when a new low prints. So a stock that spiked to a high months ago and has been declining ever since can still show a Double Trouble of 2.0, because it remains well above last year’s bottom even as it makes lower highs on the way down. The ratio reads "strong" while the recent action is anything but.

So never read the screen alone. An acceleration screen like Trend Intensity 65 will show a falling stock’s short average drop below its long one, which contradicts the stale Double Trouble. Relative strength fades as the name underperforms. The persistence read is only trustworthy when a fresh acceleration read agrees with it.

The other limit is history. Double Trouble needs a full 252 sessions to compute a low, so genuinely strong new issues are invisible to it for their first year on the tape, no matter how far they have run. If a name you know is moving returns nothing on the screen, the missing 252-day window is the usual reason.

In the terminal, dt runs Double Trouble with Bonde’s default: close divided by the 252-day low, at or above 1.8. The result is ranked by the ratio, and the raw reading appears in the score column, so you can see at a glance which names are barely past 1.8 and which are far beyond it. Names without a full year of history simply do not appear, which keeps the IPO trap out of the results.

The screen composes like any other source. dt rs>90 keeps only Double Trouble names that are also in the top decile of relative strength, the pairing that guards against the stale-denominator problem. dt | top 20 | chart walls the twenty most-extended names for a visual pass. And (dt or ti65 or mdt) | overlap unions Double Trouble with the acceleration and modified screens to surface the names all three agree on.

Double Trouble is a name-level read; it never feeds Stance. Check the market regime first (that is what tells you how much rope the tape is giving momentum) then let the screen point you at the names using it.

Frequently asked questions

Keep reading

• The Stockbee Momentum ScreensThe family Double Trouble belongs to, and why the screens are meant to be run as a set.
• Trend Intensity 65The acceleration read that guards against Double Trouble’s stale-denominator trap.
• Modified Double TroubleThe same idea measured against the 126-day mean instead of the yearly low.
• Relative StrengthDistance from a floor versus performance against the whole universe: the two are not the same read.