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Make profit from falling markets

Make profit from falling markets

When the price of a product falls, we can make a profit through continuous selling transactions.

Observe the chart characteristics of the falling market, there are many opportunities to sell :
1. When the decline breaks below the previous low
2. When the price rebounds to the previous high

What is a falling market? Because the short force of selling is stronger than the force of buying, the price of the product keeps falling. There are constant bad news in the market, the bears dominate the market. Judging from the performance of the price chart, the price continues to fall below the previous lows, and the moving average indicator shows a downward bearish arrangement. This kind of market is what we call a falling market.

How to make profit from falling market?
First of all, we have to find the previous low and pay attention to whether the price has fallen below the previous low during the fall.

The price position of the previous low point is the key position of resistance to the decline. The price fell below the previous low and broke through the resistance, and the decline continued.

Then, keep in mind the principles of falling market trading A short position is established after breaking through the key downside resistance.