You get rewarded instantly. Most of the time there is instant bounce 🙂
A Leadership stock is the one that has outperformed the market by a wide margin in recent times. Then, due to market conditions or some other situations, the stock pulls back and tests an important support/moving average triggering "Buy the dips" opportunity.
Here's Rain Industries in "Buy the dips" situation
Rain Ind at 100 dma: The stock has done all the right things so far pic.twitter.com/WAxudNgXGH
— Deepak Singh (@smarket) June 22, 2017
Now twenty days later - the stock is up 24% from that level.
Let me share one US stock example: Bank of America stock has been a major mover post-Trump Victory. The stock pulled back in April to a horizontal support level triggering Buy the dips opportunity
Now, Here's what has happened to the stock on every time it has declined to the horizontal support level in last 3-4 months
There is a reason why traders follow strong stocks because "buy the dips" is extremely rewarding in such stocks
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Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers