Pro Trading Tip #1, Buy When Oversold


A smart investor knows how to take advantage of flash market conditions. Above is an example of how to make the most of oversold conditions. Oversold conditions are seen when looking at the RSI (Relative Strength Index) for a particular coin on a particular time frame.

What you are looking for is where the RSI dips below 30 ( 30 is the white dotted line at the bottom of the purple area in the RSI in the chart here).

This means that the coin has been oversold and the price is likely to increase.

The trick to this is to try and scale into the the oversold territory with your buy orders , in a V shape as in the chart.

When you notice oversold you can buy in as follows(check out th chart to visualize this):

Eg.

A - buy 100 units

B - buy 200 units

C - buy 300 units

then you see a bullish engulfing candle ( big green candle), this signals the price reversal.

D - buy 300 units

E - buy 200 units


If this is done properly your losses at A and B are made up for by your buys at C and D.



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