by 
The Curious Bag
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Stock market traders want to be able to buy stocks and sell them at a higher price. There are different strategies that can be employed to determine when is the best time to buy into specific stocks.
Function
Buying a stock on weakness is the purchase of shares of selected stock when they decline in price. The goal is to purchase attractive stocks at a lower price.
Potential
Buying stocks on weakness can be attempting to purchase stocks for long term holding at an attractive price or part of a trading strategy to profit from price change reversals.
Identification
Buying on weakness is most effective when the stocks and overall stock market are in an uptrend and the current downward price movement is considered to be a temporary event.
Theories
Buying on weakness and selling into price strength is the basis of swing trading strategy. The strategy uses charts to find price oscillations and profit on the tendency of stock prices to repeat trends.
Warning
Stock price weakness can also indicate a fundamental change in the financial situation of the company. Investors who buy on weakness must be sure the decline in price is just a normal market cycle and not an indication of problems and further price erosion.
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