Buying on the Dip with Pivot Points and Support/Resistance: A Strategy Overview The "buy on the dip" strategy involves purchasing an asset when its price falls to a perceived undervalued level, aiming to profit from a subsequent price increase. Pivot points and support/resistance levels can be helpful tools in identifying potential entry and exit points for this strategy. Here's how it works: 1. Calculate Pivot Points: Pivot points are calculated based on the previous day's high, low, and closing prices. They act as a central reference point, with additional support and resistance levels (S1, S2, R1, R2, etc.) calculated around it. 2. Identify Support Levels: Support levels represent areas where buying pressure is likely to increase, potentially halting the price decline. Pivot point support levels (S1, S2) can be used as initial reference points. 3. Analyze the Trend: Before buying, it's crucial to understand the overall market trend (uptrend, downtrend, s
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