Pullbacks

What this unit covers

Learn to tell a pullback, a temporary move against the trend, from a real trend reversal on a real chart.

By the end you will be able to

• Tell apart a pullback from a reversal using trend structure.
• Apply the benefit-of-the-doubt rule to decide hold, exit, or wait.
• Recognise when evidence is unclear and conclude 'not enough evidence yet.'

How it starts: A Dip After a Steady Rise

1. A stock you hold has climbed steadily for three months.
2. It falls for four straight days, down 8 percent.
3. Do you sell now, or wait and watch?

Words you will meet

Pullback

A shallow, short move against a trend that does not break its structure.

Reversal

A genuine change of direction, confirmed when a trend's structure actually breaks.

In this module: Reading Charts

1. Chart Patterns
2. Breakouts
3. Pullbacks (this unit)
4. Volume Confirmation