On Bottoms, We're Asking the Wrong Question

01/06/2015 6:00 am EST

Focus: MARKETS

Adam Button

Co-Owner and Managing Director, ForexLive.com

Adam Button, of ForexLive.com, points out two of the most-oft repeated questions that traders ask and why they’re revealing but might not be the right questions to be asking and he highlights the question that is better suited for the markets, especially in regards to bottoms.

Markets are numbers-driven but words are underrated.

The way we use words reveals how we think. One of the most repeated questions in markets is “Is this the bottom?” Another one is “When will it bottom?”

Both questions imply a, sort-of, urgency. They are revealing because they says we should be deciding whether or not to buy now or right when something hits that bottom.

The right question to be asking is “Was that the bottom?” It correctly implies that the time to buy isn’t right at the bottom, it’s after a rebound has been established.

By Adam Button, Editor, ForexLive.com

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