When it comes to stock investing, timing can make a big difference—but it’s also one of the hardest things to get right.
Two common strategies you’ll hear about are:
✅ Bottom-Fishing – Buying a stock when it’s down, hoping it will bounce back
✅ Top-Chasing – Buying a stock when it’s flying high, hoping it will keep going up
Both can work—but only when used wisely, especially in a market like Bangladesh, where price moves are often triggered by news, elections, global trends, and investor sentiment.
📊 What Makes the Bangladesh Market Move?
Stock prices on the DSE can swing due to many reasons:
- 🧾 Company news (earnings, dividend announcements)
- 🏛️ Political events (elections, new regulations)
- 📦 Global trade shifts (impacting RMG and pharma exports)
- 💵 Currency changes (BDT/USD rates)
- 📈 Interest rates and inflation
These create dips (possible bottom-fishing moments) or surges (top-chasing temptation).
🎣 How to Catch the Bottom (Without Getting Burned)
Buying a stock when it looks “cheap” can pay off big—if the company recovers. But timing is tricky. Here’s how to do it smartly:
✅ Check the Past
Look at the stock’s historical price chart. Has it bounced back from similar dips before?
✅ Focus on Fundamentals
Is the company profitable? Does it have steady earnings, strong cash flow, and a clear business model?
(Think: Square Pharma, GP, Beximco Pharma)
✅ Set a Price Target
Don’t guess. Decide a realistic price range you’re willing to buy at—and stick to it.
✅ Use Technical Indicators
- RSI (Relative Strength Index) below 30 = potential oversold zone
- Look for support levels where the stock has bounced before
⚠️ Avoid “Falling Knives”
If the stock is crashing due to serious issues (like fraud, delisting risks, or massive debt), low prices may just get lower. Do your homework.
🚀 When to (Carefully) Chase the Top
Sometimes, stocks just keep going up—driven by strong momentum or exciting news. It’s tempting to jump in.
✅ Confirm the Trend
Is the stock making higher highs and higher lows over days or weeks?
✅ Watch Trading Volume
Rising prices with high volume usually mean real investor demand—not just hype.
✅ Know the Reason Behind the Rise
Is it based on solid growth (e.g., profit jump, new contracts), or just rumors?
✅ Use a Trailing Stop
If you buy at a high price, use stop-loss tools to protect profits if the trend reverses.
✅ Don’t Let FOMO (Fear of Missing Out) Win
Jumping in blindly at the top is risky. Only invest if the story makes sense to you.
🔁 Can You Combine Both Strategies?
Yes—many experienced investors do.
In Bangladesh’s market, both approaches can work depending on the timing and company quality.
📉 Buy the Dip:
When strong companies fall due to temporary fear (e.g., political uncertainty), it may be a buying opportunity.
📈 Ride the Trend:
When a stock shows strong upward momentum backed by earnings and demand, consider holding or adding on pullbacks.
👉 Combine fundamental analysis (company strength, economic news) with technical signals (RSI, MACD, volume) for better timing decisions.
💬 Questions from Everyday Investors
Q: Is it better to catch the bottom or chase the top?
A: Depends on your risk level.
- Bottom-fishing = higher risk, higher reward
- Top-chasing = works if momentum is strong, but timing must be tight
Q: How do I avoid emotional trades?
A: Create a simple plan:
- Set your entry price
- Decide when to take profit or cut losses
- Stick to your rules—not the hype
Q: Can technical analysis show the perfect bottom or top?
A: No. It gives clues, not guarantees.
Use it along with financial research—not instead of it.
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