During the Covid-19 crash, stock prices for DBS retraced to about $20 level. This is also the historical resistance zone back in the year 2000 to 2015. But this resistance was broken in 2017 when DBS prices rallied above the $20 zone.
So when prices retraced to this level again during the March 2020 crash, there is a possibility that this prior resistance zone would turn into a support zone. If this indeed turned into a support zone, prices would rebound off from the support zone and rally up. Hence, we added positions of DBS at approximately $20.
In the event if prices retraced to the next lower support level, we can continue to add shares in tranches to lower down the average cost per share. We apply TA to help us identify appropriate price levels to buy the shares to increase the upside potential of our investments. While TA does not guarantee that one would get the shares at the exact bottom of the crash, the thing is we also do not need to buy at the exact bottom to be hugely profitable. As long as we apply TA to buy stocks at great prices when they are going on sale, that would increase the chances of getting sizable profits once the recovery sets in.