Trading stock market limit downs

Well, today marks the first Monday in several weeks when the markets have not experienced a limit-down soon after opening in reaction to events that happened over the weekend, which is a good thing for most investors. However, short-term professional traders at many hedge funds and proprietary trading desks have been making a killing during the current period of heightened market volatility.

I would not advise you to focus on creating a stock trading strategy specifically for trading limit-down scenarios given that these setups rarely occur. Instead, you should commit most of your resources to creating and successfully trading a strategy that takes advantage of common setups in the market.

Its impossible to generate regular income trading a setup that occurs once every few years. We have trading guides on the website that should help you formulate a more reliable trading strategy. However, if you still want to trade limit downs, you can easily do this by modifying a reversal, or other appropriate price action trading strategy.