A reading below 30 suggests an asset is "oversold" and may be due for a bounce.
It works best in established bull markets where the underlying fundamentals of the asset remain strong despite the price drop. Key Tools for Identifying a "Dip"
Traders often buy when the price touches a major support line, such as the 50-day or 200-day SMA .
When the price hits or drops below the lower band , it often signals an extreme deviation that may revert to the mean.
Historical price levels where buyers have stepped in previously act as "floors" for current dips. The Main Risks How to Buy the Dip Like a Pro | AvaTrade Guide
Traders wait for a price drop (often 5%–10% or more) and enter a "long" position, aiming to profit when the price rebounds.
More Episodes from Pastor Jason Lim:
A reading below 30 suggests an asset is "oversold" and may be due for a bounce.
It works best in established bull markets where the underlying fundamentals of the asset remain strong despite the price drop. Key Tools for Identifying a "Dip"
Traders often buy when the price touches a major support line, such as the 50-day or 200-day SMA .
When the price hits or drops below the lower band , it often signals an extreme deviation that may revert to the mean.
Historical price levels where buyers have stepped in previously act as "floors" for current dips. The Main Risks How to Buy the Dip Like a Pro | AvaTrade Guide
Traders wait for a price drop (often 5%–10% or more) and enter a "long" position, aiming to profit when the price rebounds.
