I received an email from Ron who wrote:
Does the following saying apply to Forex?
“Buy when everyone else is selling and hold until everyone else is buying.”
How does this work and if everyone is buying, who is selling?
That saying simply means buying on the dip (when price retraces to a lower level) and holding on to an asset with continued demand. If there is demand, the price will likely rise. If demand falters and investors start selling, the price will fall. This applies to all asset classes, not just to stocks and the Forex market.
Every transaction needs a buyer and seller. If everyone wants to buy and no one is selling, orders will not get filled in the first place. This scenario could happen just before major news releases or announcements that impact the Forex market. Afterwards, business will be as usual and there will be buyers and sellers at any point in time.
To your success as a profitable trader,
Mario
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