As you can see from the chart above, the Nasdaq also gapped down a bit more than 20 points, from 2067.35 to 2035.09, having an additional impact on Veritas.

Looking at its chart, we can see that Veritas closed on July 17 at $50.42 and gapped down with the general market a bit less than 10 points, opening at $40.82 on July 18. I was expecting Veritas to dip slightly at the open, then bounce, and then follow the general market.

Veritas opened at $40.82, dipped as expected to $40.38 at 9:31 a.m. EDT, then bounced. I was ready for this entry and caught the bottom. When buying dried up on the way up at 09:34 a.m. when it hit $41.30, I should have exited, but didn't. I held on because the overall market was still heading up. I finally exited as the stock broke down at 9:44 a.m. at $41.10 for a bit under a 0.75 point gain.

The stock then did a vertical drop until 9:59 a.m. EDT, when it hit $38.82. When it dropped below the premarket support level of $40.00, I expected it to turn into what I call a multi-bottom dumper. I treat each of the interim bottoms on the way down as scalps once a stock turns into a multi-bottom dumper, because they turn on a dime and continue lower a good percentage of the time.

I was ready for the second bottom at 9:59 a.m. and waited for the selling to slow and buying to come in. I was very quick to enter the trade when it hit $38.82, but exited just as quickly when the buying dried up (and abruptly changed direction at $39.95). The top was too quick for me and I didn't exit until it dropped to $39.80 for a little more than a one-point gain.

Then it started an even steeper drop when it hit its real bottom at 10:23 a.m., bouncing off $36.60. I was waiting for this bottom but missed the entry point and elected not to chase. Chasing a multi-bottomed dumper can be dangerous, so I elected to sit it out. I missed out on a two-point rise before it broke down again.

Many traders don't mess with multi-bottomed dumpers, and I recommend only experienced traders attempt them because of the often quick and severe reversals. In this type of jumpy market, I try them because that is all the market is offering. They're tricky, but worth a shot if you're quick and can anticipate the stock's pattern.