Traders often buy when the price touches a major support line, such as the 50-day or 200-day SMA .
Professional traders rarely buy blindly; they use technical indicators to find high-probability entry points: buy the dip strategy
It works best in established bull markets where the underlying fundamentals of the asset remain strong despite the price drop. Key Tools for Identifying a "Dip" Traders often buy when the price touches a
A reading below 30 suggests an asset is "oversold" and may be due for a bounce. or minor news.
The core philosophy is : the belief that prices will eventually return to their long-term average or trendline after a short-term pullback caused by panic selling, profit-taking, or minor news.