Monday, July 1, 2024

Buy and Sell Signals | Larry Williams

If I observe prices in a strong downtrend, followed by a period of sideways movement before another decline, only to immediately return to the previous trading range, that's a buy signal.
 

Buy Signal: Dump, dump, (dump), go sideways and pump a bit, one more small dump, then the pump.
Sell Signal: Pump, pump, (pump), go sideways and drop a bit, one more small pump, then the dump.
 
Why? Because, during the sideways range, accumulation was taking place. The breakdown likely liquidated many long positions, and professional money will often buy in that area.
 
 
If the price quickly returns to the range, it confirms that they’ve been buying, and that's when I want to enter a long position in the market.
 
See also: