[Follow The Trend]

Wow, my averaging down comment has prompted a barrage of advice!!!

While I have used averaging down on some occassions, it is not common place in my most popular trading strategies. I am more a trend man, unless I see some extremely good "value" in a stock, and feel the fall has been over done.

These type of positions tend to be more longer term, although on the odd occassion they can bounce in the short term.

[ezduzzit]

Yes well, catching falling knives is second only to stepping in front of freight trains when it comes to hazardous trader entertainment.

I suspected all long you were well aware of the risks of averaging down and to be quite candid, we all have played out that scenario several times as we began learning to trade and there is no doubt in my mind that most of us could still admit to taking such a chance (despite the known risks) every once in a blue moon or so.

Happy Trading