Pullback Entries

Buying a strong stock after a short dip toward a rising moving average is one of the classic swing setups. Here is a real example, step by step, with the numbers.

The idea

In a healthy uptrend, dips tend to find buyers near a rising short-term average, often the 10-day or 21-day. A pullback entry waits for the stock to dip on lighter selling, then buys when it turns back up. You get a better price than chasing a breakout, and your stop can sit close, just under the low of the dip.

A pullback to a rising average, then an entry as price turns back up. The stop goes under the pullback low.

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