Thread-Stage Analysis. Thanks to @MashraniVivek for Introducing this in hackathon session
Source - Secrets for Profiting in Bull and Bear Markets, by Stan Weinstein
#technofunda
Source - Secrets for Profiting in Bull and Bear Markets, by Stan Weinstein
#technofunda
Key ingredient for Stage Analysis
-Weekly Chart โSystem for Long Term trade
-31 EMA - Price action vs 31 week EMA
- Volume -Transition from Stage 1 to Stage 2 supported by big volume
-Market Indexes โSector/market must in stage 2
-Relative Strength-Outperforming the NIFTY50
-Weekly Chart โSystem for Long Term trade
-31 EMA - Price action vs 31 week EMA
- Volume -Transition from Stage 1 to Stage 2 supported by big volume
-Market Indexes โSector/market must in stage 2
-Relative Strength-Outperforming the NIFTY50
Stage 1: Basing Stage
Long base on the chart
-Create a list of stocks in this stage & identify pivot point
-Check sector tailwind to validate the breakout into Stage 2 supported by sector
-Look for increased volume as approaches the breakout level
-Stage 1 go from weeks to years
Long base on the chart
-Create a list of stocks in this stage & identify pivot point
-Check sector tailwind to validate the breakout into Stage 2 supported by sector
-Look for increased volume as approaches the breakout level
-Stage 1 go from weeks to years
Stage 2: Advancing Stage
*stock breaks out of the horizontal base
*Rising 30 EMA & 11 EMA above 30
*Market/Sector Trend +
*Sector Relative strength +
*Ideally 2x average weekly volume for the breakout week
* The bigger the Stage 1 base the less resistance the stock will have
*stock breaks out of the horizontal base
*Rising 30 EMA & 11 EMA above 30
*Market/Sector Trend +
*Sector Relative strength +
*Ideally 2x average weekly volume for the breakout week
* The bigger the Stage 1 base the less resistance the stock will have
Actions in Stage 2
*Buy on the breakout or on a pullback to the breakout level.
*Stock can be held until a Stage 3 top forms
* Stocks moves hugging 11 ema
*If setup again into a Stage 2 continuation breakout after the initial breakout.Point to add more within an existing uptrend
*Buy on the breakout or on a pullback to the breakout level.
*Stock can be held until a Stage 3 top forms
* Stocks moves hugging 11 ema
*If setup again into a Stage 2 continuation breakout after the initial breakout.Point to add more within an existing uptrend
Stage 3: Consolidation/Topping Stage
*Trend sideways in Stage 3 & lose momentum
* 31 EMA loses its upward slope and 11 EMA starts touching or cross below 31
*Wait for a Stage 4 breakdown to sell the stock
*If the stock happens to break back into a Stage 2 advance, buy again/add
*Trend sideways in Stage 3 & lose momentum
* 31 EMA loses its upward slope and 11 EMA starts touching or cross below 31
*Wait for a Stage 4 breakdown to sell the stock
*If the stock happens to break back into a Stage 2 advance, buy again/add
Stage 4: Declining Stage
*Stock breaks down below Stage 3 range & below the 31-week EMA in Stage 4, and continues to decline mostly below the 31 EMA
*Sell during the transition into this stage, since they can lose considerable value if held
*Stay out of all stocks in stage 4
*Stock breaks down below Stage 3 range & below the 31-week EMA in Stage 4, and continues to decline mostly below the 31 EMA
*Sell during the transition into this stage, since they can lose considerable value if held
*Stay out of all stocks in stage 4
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