What Is the Daisy Stop?
The daisy stop is a price level where a security reverses from a short-term downtrend and begins moving higher. Traders use it to identify potential support and to time entries or exits.
How the Daisy Stop Works in Practice
When price breaks below a recent low but quickly recovers, the low often becomes the daisy stop. This level can act as a floor for the next rally, especially if volume supports the move.
Why Traders Watch the Daisy Stop
Watching the daisy stop helps traders manage risk and spot trend changes. It is often used alongside moving averages and volume analysis to confirm reversals. For more on technical analysis, see Investopedia.
