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Stock Market picking a bottom by D este
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Stock Market picking a bottom |
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Investment,Finance & Investment
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Most investors and traders were taught to buy low and sell high. This makes the trader seek out the bottoms of the markets so they can be first to buy. It is also their downfall as most get in too early and don't see the correct entry. Look at a typical move down from supply and low volume. We see that the markets make what appears to be a bottom. However, this move to the upside is started by traders taking profits from their short positions, not a true change in trend. Note the lack of volume in the bullish or green candles as well as no bottom wicks on the candles. Small candles indicate the there is very little buying or selling. Stock Market picking a bottom The difference in the price action when the real bottom is achieved will typically have increased buying pressure shown by increased volume and bottom tails on the candles. All of this usually occurs at a level of previous demand from a larger time frame. You should bide your time by building a watch list of investment themes that you believe will help you reach your goals. Traders have long been watching of low volatility and dividend focused strategies that emphasize total profits. The open doesn't always give traders a good idea of where we will close on any random sample. However, when locked in to a trend the power of this tell becomes an overwhelming edge.
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