Buy the dips!

Hello all,

I often see referencing to 'buy the dips' and 'sell the tops' (I think!) and was hoping someone could put some defination with maybe a chart?

I understand and appreciate the theory behind the strategy but how do you define 'dips'? What constitutes as a dip and not a change in direction and actually a downtrend?

It seems to be quoted by many as an easy thing to do but whenever I try or even think about it, its just a change of direction instead!

Thanks

Try selling strength and buying weakness. :cheesy:

oatman said:

Try selling strength and buying weakness. :cheesy:

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Care to define 'strength' and 'weakness'?

Unless you are truly reading Price and Volume in the correct manner, you could be suggesting the old 'stand in front of speeding freight train' scenario so beloved of newbies.

"It'll swerve before I do!"

TheBramble said:

Care to define 'strength' and 'weakness'?

Unless you are truly reading Price and Volume in the correct manner, you could be suggesting the old 'stand in front of speeding freight train' scenario so beloved of newbies.

"It'll swerve before I do!"

Click to expand...

Can't define it, it's more of a feeling you'll get after a time.

wasp said:

Hello all,

I often see referencing to 'buy the dips' and 'sell the tops' (I think!) and was hoping someone could put some defination with maybe a chart?

I understand and appreciate the theory behind the strategy but how do you define 'dips'? What constitutes as a dip and not a change in direction and actually a downtrend?

It seems to be quoted by many as an easy thing to do but whenever I try or even think about it, its just a change of direction instead!

Thanks

Click to expand...

You have to have a clear idea of your trend. Then you can decide where your pullback price is.
However, my experience of previously buying when that has been reached resulted in too many failures so I wait for confirmation, now, before entering. Forget indicators, use the bars.

I'd like to say "Forget volume" too, because that's how I feel. However, there are too many good people on here who swear by volume so I can only assume that it has something which is mystifying to me. Let's just say that I don't seem to need it!

Split