Tempted to Buy the Dips? Read this first…
by Chad Shoop
Chad is a Chartered Market Technician (CMT) who specializes in stock and options trading. For over 12 years, he’s led some of the largest trading research firms on the planet.
The stock market is showing signs that 2025 could be a rough year.
Big indexes are sitting below their 200-day moving averages, which is usually a bad sign. This means stocks might keep dropping, and buying every dip could lead to big losses.
If you don’t have a plan, trying to buy low could feel like catching a falling knife.
A dangerous and painful experience.
But I’m still buying dips.
The difference? I do it strategically.
Instead of jumping into every price drop, I follow a proven method that helps me make smarter trades.
That’s what separates successful traders from those who struggle to time the market.
Buy Dips the Smart Way
Instead of hoping for the best, I use a proprietary signal called the Power Play Indicator.
This combines money flow patterns with a variation of the Bollinger Bands to find the best moments to buy, right before a stock rebounds. The goal is to find stocks that traders are going to be targeting for a big short-term move.
This market, with increased volatility and hearing about a potential bear market on the horizon, sets up wild swings for individual stocks. You just have to know where to look.
When our Power Play Indicator flashes a buy signal, it means a stock is ready to bounce back.
This removes the guessing game. When we get a signal, it’s a proven method to target short-term pops in individual stocks.
For example, we recently traded Ford (F) using this strategy.
The stock dropped hard in February, just like the rest of the market. But instead of guessing when to buy, we waited for our indicator to tell us that buyers were stepping in.
As you can see in the chart above, the Power Play Buy Signal (the Green Arrow) came in at the perfect time.
Ford shot up 10% in just one month, or a potential for a 100% move in the options market, even while the overall market stayed weak during this period.
Lately, major stock indexes have been struggling. But some individual stocks, like Ford, are still moving higher.
That’s why you need to focus on specific setups instead of just buying anything that’s cheap.
Why This Works in a Bear Market
One thing that I’ve been telling traders recently, is that just because you hear “bear market” and even if we are in one, you still don’t abandon buying the dips. You just have to be more strategic.
If 2025 turns out to be a bear market, most stocks will keep trending down.
That means traders can’t just “buy the dip” without a clear plan.
Randomly buying stocks because they’re lower than before won’t work. Instead, you need to focus on strong setups with real buying support to target stocks that have a reason to bounce, even when the rest of the market is weak.
That’s exactly what our Power Play Indicator helps us do.
It cuts through the noise, finds stocks with the best chance of bouncing back, and gives us a solid game plan.
Without a strategy like this, you could keep buying into weakness and getting stuck with losing trades.
The bottom line is now is not the time to gamble with your trades.
In uncertain times, precision matters.
Instead of following the crowd, take a smart, data-driven approach that gives you the best odds of success.
Want to trade with us and get access to these precise buy signals? Join us today and let’s navigate this market together.
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