When the chart below is in a downtrend and does not move in a positive direction, that means that the price action has a lot to do with the direction the market is headed.
In this case, as the price of the company has gone into a positive downtrend, we have seen that the stock has gained some momentum and momentum is what drives the market.
As long as they continue to rally and buy for a sustained period of time, as opposed to making a mistake, the stock is poised to move above the $1700 level which is the mid-point of the recent rally.
In the below graph, we note that the price has moved in a negative direction and is now down around $1400 at the time of writing.
This may not seem like a big move but it is really very important because it means we could see an upcoming rally in the price.
Is it a good idea to buy the shares?
Now that we have shown you that a downtrend has set in, we want to make sure that you buy the shares so that you can stay one step ahead of the ups and downs. When I say ‘buy’, I mean to buy the share, not the stock, because the shares could very well jump above the $1700 level, because if this happens, the price will move down below the $1400 level.
But if you are not prepared for this happening, you might miss out on the very big rally that we look forward to.
So, what should you be buying instead?
Well, you want to buy in a position with an exit strategy and with a very strong long-term bullish outlook.
In other words, you want to put the money in right after the dips come and sell at the bottom, rather than letting it go below as the price has fallen below your target.
Of course, you may not want to make this buy every time a downtrend takes off; you will miss out on what could be a very big rally, but when there is a great chance that the stock goes higher, it could come.
And remember that you are not paying less in the short term because the stock has surged; you are taking a huge percentage in the long-term.
So it is a very powerful move and we all know that you could lose a lot from a move like this. But you should buy in the long term, if you want to take advantage
day trading vs swing trading vs position trading, swing trade stocks or forex, best stocks for swing trading may 2020, best swing trading stock picks, best swing trading strategies malayalam