What exactly is a "Dip",or what is the exact criteria for a "dip". Maybe it's just some silly ET slogan or inside joke that I'm not privy too. I'm just curious. Is there any merit to this phrase?..Is this relative to the equity index futures? Or, just some ambiguous stocks out of the 3000 in the overall market.
dip is something observed after the fact. A retracement against the trend. In the midst of it, people wont call it a dip. Dip seems to have implied connotations that prices quickly resume the trend. More so then not in equity, they do. When equities get 'trained', by large trading houses as such. This behavior patterns reinforces itself and runsaway. Creating a large bull cycle. When the 'edge' is in the 'reinforced training' over past sessions.
If a trading vehicle dips more than 61.8% from a recent pivot point high then chances are it is not a dip. I normally wait for a 50% retracement and look for a good candle to get in from there.
Funny thing is that I think we are all dip buyers to some extent Its just that some of us would like to buy dip that is a bit deeper than 1/2 ATR.
we call it a healthy pull back to a support level...but never confude a dip with a reverse in trend..then you are catching a falling knife...