News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Buying on Dips and Selling on Rallies

Buying on Dips and Selling on Rallies

Richard Krivo, Trading Instructor

Instructor’s Response:

 
Take a look at the chart below for a visual…
 
You will see that the pair is in an uptrend. Each time that price action retraces (dips down) from its upward move, that is an opportunity to buy the pair. The rationale is that the trader is entering the trade at a better (lower) price as it has come down from a high and also the trader will not have to endure the retracement that would occur if they bought at the high.
 
In a downtrend the reverse would be true and the trader would sell the pair each time it rallied up..."selling on rallies".
 
So, in an uptrend we “buy on dips” and in a downtrend we “sell on rallies”.
 
chart 5 19 10
 

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES