I love floors that form in charts. Why?
Floors capture the essence of buying low.
Plus, they tell us when longs are buying and shorts are covering.
People tend to become disinterested in a stock when the floors are going to work. You can use psychology as an added edge.
Frankly, they just fit my trading.
What’s awesome about floors?
You know where you are wrong.
Where you’re wrong is close by.
Similar principles work on nearly all time frames.
They often form after a long term false breakdown.
What stinks about floors?
They can be temporary or closer to permanent.
It’s hard to know when they will hold.
You never know how long they will consolidate.