What is reinforcement 🙄🙄🙄
Or reducing losses and increasing profits ✌️
Reinforcement is buying more of the currency after its price has dropped below the price at which you previously bought it 💰
In other words, to clarify, if you bought a currency at a price of 1$ in a deal of 10$ , meaning you bought 10 currencies, and after a while, the currency dropped to 0.89$ , for example, the trader increases the purchase at a price not less than a third of the deal, which is an amount of 3.5 $
And if it drops further, they can reinforce again and so on 👍👍
Benefits of reinforcement 👌
First, reducing the severity of the loss, meaning that the drop in the currency will make you lose, but if you bought at a high price and reinforced at a lower price, your loss will be at the midpoint of the rate, not at the bottom of the rate of loss.
Second, increasing profits, and this is what we always hope for in the case of a currency drop and buying it for a small amount. You can increase the profit by selling at a higher price and buying at a lower price, which makes the profit guaranteed when the currency price reaches the original purchase price, thus achieving profit through reinforcement.
This is a simplified explanation, and if you have any questions, I am at your service, and may God grant everyone success.