Buy setbacks on the uptrend and sell downside recovery
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Buy setbacks on the uptrend and sell downside recovery
This principle, which in the English original with "buy the dip and sell the rally" in the formulation is much more handy, emphasizes that you should act as an investor when entering a position as possible anti-cyclical. He concretizes the above-mentioned principle of trend-conforming action. The counter-cyclical entry into the overall trend is attractive from a trading perspective, mainly because of the generally better chance-risk ratio. In this strategy, the investor can usually set a narrower meaningful stop-loss to limit losses than an outbreak strategy. The question of where exactly the entry should be made, however, is not specified by the rule. The long entry into the uptrend should be in the area of underwriting derived support, the short entry into the downtrend in accordance with identified resistors.
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Emin Schmidt