Support and resistance lines are just a GUIDE, not a MUST !!!Just because it has landed on the support line or resistance level does not mean it must rebound or heads south. As investors, we must know that these are based on historical patterns and past history is not a representation of the current market conditions.
Thus, it is wise to take a small nibble , say 10% of your capital if you had done your homework on this ETF/stock. If it goes up as you wanted, congratulations but if it does not , you have the choice to re-enter at a much lower price and your average price is much cheaper overall.
Imagine if all stocks hit support line and rebound , becoming a sure thing , wouldn't every trader become multi-millionaire? Ask yourself, are there more online gurus, coaches, physical classes conducting how to make money from stocks, options, forex, etc than 5-10 years ago?
Capital allocation is not about guts or I dare you but rather a calculated risk management tool to protect yourself. In the market, there is no such thing as GUARANTEE. So, learn to protect yourself, your money and you will have a less rocky journey towards investment.
