In each time frame (5min, 15min, 30min, 1hr, daily or weekly chart), the stock will be in one of the following 4 stages:
Stage 1 (Accumulation phase) : Stocks is under accumulation by the big players and fund managers who are able to move the market with their millions/billions.
Stage 2 (Mark-up phase) : Stocks prices are being pushed up as buyers comes in to support the prices and are willing to pay higher prices for the stock.
Stage 3 (Distribution phase) : Latecomers rush in to buy the stock at these high prices while traders who had bought earlier are not selling their stocks to the latecomers.
Stage 4 (Mark-down phase) : There are no more buyers after the latecomers arrived at the distribution stage and all that are left are all sellers as the stock price begins its decline. The whole cycle then repeats itself again from stage 1.
Now Let's take a look at Las Vagas Sands daily chart:
If we compare the above chart with the Dow Jones Index (see chart below). Which stage do you think we are at now?
Stage 1 (Accumulation phase) : Stocks is under accumulation by the big players and fund managers who are able to move the market with their millions/billions.
Stage 2 (Mark-up phase) : Stocks prices are being pushed up as buyers comes in to support the prices and are willing to pay higher prices for the stock.
Stage 3 (Distribution phase) : Latecomers rush in to buy the stock at these high prices while traders who had bought earlier are not selling their stocks to the latecomers.
Stage 4 (Mark-down phase) : There are no more buyers after the latecomers arrived at the distribution stage and all that are left are all sellers as the stock price begins its decline. The whole cycle then repeats itself again from stage 1.
Now Let's take a look at Las Vagas Sands daily chart:
If we compare the above chart with the Dow Jones Index (see chart below). Which stage do you think we are at now?
Stage 3?
ReplyDeleteLooks like the commencement of stage 4 ! =)
ReplyDelete