Basing

Dictionary Says

Definition of 'Basing'

A period in which a stock or other traded security is showing little in the way of upward or downward movement. The resulting price pattern is a flat line. Often, 'basing' is a term used by technical analysts to describe an issue that is consolidating after a period of rapid growth or decline. A basing stock is one with equal amounts of supply and demand.
Basing
Investopedia Says

Investopedia explains 'Basing'

Basing is a common occurrence after a stock or the market has been in a lengthy decline or has increased by a large amount. In other words, the market is taking a break. Some stocks can form a base that lasts for severals years before the trend is reversed.

A basing stock is also thought to be one that is forming new lines of support and resistance. In essence, basing is the merging of previous lines, which leads to the formation of different ones. Many technical analysts believe that basing is crucial, especially for surging stocks. They view basing as the "breather" that allows the issue to continue climbing.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Index

    A statistical ...
  2. Technical Analysis

    A method of ...
  3. Trend

    The general ...
  4. Sideways Trend

    Describes the ...
  5. Risk

    The chance that ...
  6. Universe Of Securities

    A set of ...
  7. Arithmetic Mean

    A mathematical ...
  8. Fundamental Analysis

    A method of ...
  9. Moving Average - MA

    An indicator ...
  10. Moving Average Chart

    A tool used by ...

Articles Of Interest

  1. Basics Of Technical Analysis

    Learn how chartists analyze the price movements of the market. We'll introduce you to the most important concepts in this approach.
  2. Triangles: A Short Study In Continuation Patterns

    Learn how to read these formations of horizontal trading patterns.
  3. Spot Hotshot Penny Stocks

    Don't flip a coin to find your next investment.
  4. Tips For Controlling Investment Losses

    A profit/loss plan helps investors recognize mistakes and invest logically, rather than emotionally.
  5. Triple Screen Trading System - Part 4

    How can a trader use the Elder-Ray oscillator as the second screen of this system? Find out here.
  6. Triple Screen Trading System - Part 3

    Learn about market wave, the second screen in this three-part system.
  7. Triple Screen Trading System - Part 2

    Market tide is the basis for making trading decisions in this three-part system.
  8. Triple Screen Trading System - Part 1

    Learn to take advantage of both trend-following and oscillator techniques to analyze your trading decisions.
  9. Momentum Trading With Discipline

    This type of strategy demands controlled decision-making, requiring a continual refinement of entry and exit techniques.
  10. Trade On Support For The Best Exit Strategy

    Find your sound exit strategy based on support and resistance levels, while understanding the psychology behind them.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center