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On rest and recovery days it is important to avoid doing the worst thing you can do for your body... nothing. Examples of rest and recovery activities are walking, static stretch exercises (after a warm up and loosening up period), dynamic stretching, swimming, water running, and riding a bike.
The exercises get progressively more difficult and should always be done pain free. See medial meniscus rehabilitation program for more details of which exercises are suitable for a particular stage of rehabilitation. In general the patient will start with isometric or static contractions, progress to exercises with resistance bands and finally more functional plyometric exercises before going back to full training.