Who Are These People Who Buy at the Top?

[megabucks]

Quote from riskfreetrading:

Why are there people who buy after a market move up, and then starts coming down, and they continue to buy. For instance, I cannot explain why anyone would buy the QQQQs and the Dow after 1:45PM today. The market is coming down. So what is in their mind to tell them to buy a thing that is coming donw?

simple - momentum traders who buy strength on pullback on larger time frames than what you are trading. Maybe they know something.

 

[riskfreetrading]

Quote from megabucks:

simple - momentum traders who buy strength on pullback on larger time frames than what you are trading. Maybe they know something.

I agree with you on the multiple time scale thing (although I think those trades will wait for the pullback, they would not buy close to the top of the day).

As for "maybe they know something", it should work in invidividual stocks. As for the QQQQs, it is an index ETF. Not easy to have an edge based on knowing something.

Plus I looked at volume. It looks to me that it is made mainly by traders, as it was not large. Large investors typically show up towards the close, in order not to show their hand during the day otherwise the price will run from them.

 

[ssbc19]

Quote from riskfreetrading:

Why not wait to buy at even lower price?

This makes sense if you can accurately call bottoms. But maybe some people think the market is going to turn