If you’re interested in buying dips, you have to make a few assumption, the most important is the market will not change. The market we’ve enjoyed the past 3 months will continue and the dips will be shallow and the shorts weak. If, by change, the shorts gain verve and press the market’s stress points lower than recent history, plenty of dips buys will be castrated. Best way to hedge against this is to respect stops.
For me, NEWR embodies everything I want in a dip. It was running hot, now it’s cool. The algos in Exodus have it at oversold and the track record is splendid. If “this time is different”, NEWR will cascade lower and dips buys will be frayed by the fires. However, if this dip is transient, which we have no reason to believe it isn’t, NEWR is a buy around $100 back up towards $108.
Figure out what you might want to buy now and then execute orders without worrying about the downside. The time to worry about the downside is after you’ve purchased your stocks, not before.
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