The S&P 500 is testing the bottom for a third time. It seems that the volume has been declining with each successive test. If we fail to hold these levels, then we could be in for another serious leg down.
However, with a confirmed triple bottom in place, our overall swing trading strategy will need to be adjusted. In the bear market, the predominant strategy was short sell rally tops. Now the strategy would change to buy the bottom of corrections, or "buy on the dips."
Triple bottom - A reversal pattern consisting of three price troughs at roughly the same price level. The implication is that by failing to move through such levels after three attempts, the market is meeting significant support and could reverse.
No comments:
Post a Comment