In judo, the Japanese word "ukemi" means "falling safely."

Fall the wrong way and you are likely to get hurt. Fall the right way and you will spring back to your feet quickly.

A stock falling to its 50-day or 10-week moving average is in a similar situation.

The wrong kind of fall means you had better sell the stock. The right kind of fall means it's an opportunity to open a new position or add shares.

Volume Is Key

A fall to the 50-day line in heavy volume is the wrong way for a stock to retreat, especially after shares have found support at that level earlier in their advance.

A fall to the 50-day on diminished volume, followed by support at the line, is the right way to fall.

It is important for an investor to master this aspect of chart reading. A hot stock won't always provide a new base in a timely fashion. Sometimes the trip to the 50-day line will be the only chance to get on board.

That was the case for Baidu.com ( BIDU) in 2007.

The previous spring, Baidu had broken out of a base in enormous volume.

Pullbacks After A Breakout

In July, it began forming a new base and broke out in September (point 1). Baidu had great fundamentals -- a 99 EPS Rating, a 98 Relative Price Strength Rating and an A in its Sales + Profit Margins + ROE.

The Nasdaq followed through on Aug. 29, confirming a new market rally. That gave investors a signal to start buying top-rated stocks.

From the breakout, Baidu rewarded investors as it ran to as high as 429.19 by early November.

The Chinese Internet search engine made its first pullback to the 50-day line in several weeks (point 2).

Volume was heavy as it dropped, although shares remained a close distance from the line (point 3).

Shares were back above the 50-day line in a matter of days as volume was coming in above average -- a sign that institutional investors were buying shares (point 4).

Buying Range Developed

The buy opportunity from the trip to the 50-day was there for the taking.

The rebound established a buying range that extended as much as 5% above the prior high.

Baidu never got quite that high.

Its rebound stalled, then shares made a second pullback to the 50-day line (point 5). The stock found support immediately.

The second trip to the 50-day also can be a buying opportunity.

A third trip to the 50-day line is not considered a buying opportunity. The probability of failure is much greater.

That point was made in Baidu's third test of the line, in January.

This time, it was the wrong way to fall.

An Ugly Retreat

Baidu's penetration of the line was deeper than its earlier pullbacks (point 6).

Volume was above average as shares declined, and weaker on days when shares managed to rise (point 7).

By this time, the general market was having its own problems. Indeed, the market's condition is a big factor in whether a pullback will be successful or not.

The game was over for Baidu.

The stock's correction steepened, falling to as low as 201.15 in March of last year. A rebound lasted only several weeks before Baidu went into an even worse decline.