The strategy of buying from the bottom is the cornerstone of any successful trader; when the market experiences a sharp decline and asset prices reach their lowest, a valuable opportunity opens up for you to enter trades at an attractive price that allows you to achieve significant profits when the market rebounds. But do not be deceived by the drop—buying must be calculated within a comprehensive risk management plan, by setting a fixed risk ratio (1–2% of capital per trade) and determining stop-loss and take-profit points in advance.
After seizing the opportunity at the bottom, patience comes into play: trading is not a race to take advantage of any short-term movement, but a journey that extends over the timeframe you deem appropriate. Choose your timeframe based on your style (#MyTradingStyle): a day trader for quick gains, a swing trader to hold positions for days, or a long-term investor based on strong fundamentals.
To enhance your decisions, use technical analysis tools—such as charts and indicators (MACD, RSI, moving averages)—to identify reversal patterns and measure market momentum, along with fundamental analysis that tracks economic news and supply and demand data. Sentiment statistics and the level of institutional flows can also give you an additional indicator on entry and exit timing.