You enter to buy, the price falls. And when you sell, the price rises. What's the problem?
⚠️ Many people enter to buy during the (rebound) thinking it is an upward trend. However, the price returns (falls) again.
Here we must distinguish between:
(rebound) and (correction) and (trend)
🎯 The rebound
It is a temporary movement (against the general direction of the price). Its appearance on the chart is like (two candles) or a one-day movement, and it occurs without breaking resistance.
☝️ And quickly..
The meaning of the word (resistance) is a price area that the currency reaches, and it is difficult for the price to continue rising further. The reason is that there is a lot of selling on the currency. This pressures the price and brings it down further.
- And there are two types of rebounds:
1. Upward rebound:
The price is falling and suddenly stops falling and starts to rise a little.
2. Downward rebound:
The price rises and suddenly stops rising and starts to fall a little.
✅ Example:
If a currency was falling from $180 to $145, then rose to $155 (this is a rebound). But it doesn't necessarily mean a return to rising and recovery for the currency; it might just be a temporary rise before it continues to fall.
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🎯 The trend
It is the general direction of the price movement. If you zoom out on the chart to see it from afar and notice that:
1. The price is generally rising → this is an upward trend
2. The price is falling → this is a downward trend
3. No significant rise or fall → Sideways trend (fluctuation)
✅ The trend is what determines when to start buying or selling.
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🎯 Correction
It is a temporary movement against the general direction (trend), and it is usually deeper than a simple rebound. The correction can last for days or weeks, but it does not change the fundamental trend.