Bounce Trading
Bounce trading involves buying a security when its price drops to a support level, expecting it to rebound to a higher price. It relies heavily on technical analysis, using tools like support lines, chart patterns, and indicators to predict the bounce. Traders aim to profit from short-term price reversals, employing strategies such as trendline breaks or candlestick patterns. Success hinges on accurately identifying support and timing the entry, with the goal of selling at a predetermined target as the price recovers from its dip.
Related Terms
Exponential Moving Average
Exponential Moving Average (EMA) is a technical indicator used in trading to follow price trends...
Return on Equity (ROE)
Return on Equity (ROE) is a key profitability ratio that measures how effectively a company...
Beta of Stocks
Beta measures a stock’s risk relative to the broader market, which has a default Beta...
Delivery Trading
Delivery trading involves buying/selling a security and settling it by taking/giving delivery. Unlike intraday trading,...
Bull Market
A bull market describes a sustained upward trend in the stock market. It signals optimism...
Internal Rate Of Return
The Internal Rate of Return (IRR) measures the compound annual return of a financial asset,...
