for stocks in down trend, if certain level was tested multiple times, it is a resistant level which is hard to overcome it. The tendency for breakout is more likely to fail . I made such mistake multiple times, such as NE, QIHU trades. I did not take loss at the first place, then within next few days, there was a nasty long red bar.
When such stock is a narrow range, it is a good trade to try breakout from down trend. I did good trades such as SRPT. The trade trended to stall for next bar, where some people took profit. Then the uptrend may continue higher.
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