Traders Toolbox: Reversals Revisited

Trader's Toolbox

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Image Reactions Within A Downtrend

"Reversals In my opinion, one of the most misused and abused terms in technical analysis is the reversal or key reversal. I often get calls from both new and experienced traders who are excited about a market because it has just posted a “key reversal.” While the action these traders point to often marks a reversal day, such a day (week or month) by itself actually has little significance. There is research which indicates single period reversals mark a turn only about 50% of the time. Which gives about the same odds of indicating a turn using a coin flip..."

Revisit the Trader's Toolbox Post: "Reversals" here.

4 thoughts on “Traders Toolbox: Reversals Revisited

  1. True,we can extrapolate trendlines to substantiate almost all decisions,mostly these are /are not substantiated after the event, which is not helpful in determination of an entry or exit.Confluence is the added decisive feature.

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