Why does the price tend to rise slightly after a bearish signal?
My personal understanding is,
1. During a general downtrend, there may be natural rebounds, possibly due to buy orders placed there.
2. The market makers are distributing shares, or in other words, they will sell while also supporting the price. This can make retail investors feel that the price hasn’t dropped significantly or quickly, so they don't feel the need to stop-loss.
The rebound here, or the support from the market makers, is the position for adding to their holdings. Of course, this is under the condition that the direction is confirmed to be bearish.
