#MarketPullback

PullBack - What is Pullback in Trading? 🤔📈💰

The term Pullback in the stock market is used to refer to the retracements that temporarily interrupt a trend, which tend to rely on previously surpassed support levels.

➤ Generally, traders refer to any retracement that is supported by a support or resistance level to continue the trend as a Pullback; however, it is important to know that Pullback should only apply to downtrends.

When we talk about retracements in uptrends, another term is used, Throwback, which we will discuss later in this article.

We know it is a Pullback when the "bounce" fails to break the old support (which is now a resistance!) and returns to the downtrend. This is a small break in the trend that can provide quite interesting entry signals for the trader, typically to open short positions before the trend continues again.

In the following image, you can see in a simplified way what Pullback consists of in the Stock Market.