(This post was last modified: 2020-08-20, 04:40 PM by the_manassa_mauler.)
RE: Beginners Questions
(2020-08-19, 11:54 PM)isatrader Wrote: All the sectors usually move into Stage 2 eventually in a bull market. They just come out at different times. So there will likely be a period down the line when the energy stocks start to have explosive moves into Stage 2 on volume. But when they do they will start showing up in the daily scans that I run for the watchlist. But at the moment, the only area of the energy sector making the watchlist has been solar stocks and a few outliers.
Try not to let what you think should be happening cloud what you see in the charts. If the stocks in those sectors setup from proper basing patterns, with volatility contraction and then start breaking out on heavy volume, with outperforming relative strength versus the S&P 500 and no near term resistance. Then you'll know it's time to start testing the waters.
thanks for your reply & time...
Sector personality in an initial bull market is interesting to watch. So it sounds like Weistein feels when a bull market commences, its the intial sectors that break out, that will usually have the strongest legs thru the entire duration of the bull market... I guess my thinking is too bottom fishing here. The plight of missing the initial sectors wh/ broke out early.... That said, I do wonder if sometimes, even though a sector (like energy now) is late to the game, can they still have an impressive 2a breakout & longterm legs in a bull market. Especially if they were stymied early by freaky, highly irregular events (like covid).... Your bottom line advice on watching the chart and cutting out noise is sound. Curious though, have you found in the past that sometimes due to freaky events, that some lagging sectors, can end up being strong long leg players also in a bull market?
The tougher environment is because we are months out of the market low now, and a lot of leading stocks are starting to pullback and form new bases, and individual stocks pullback 2 to 3x what the market does normally. So, a lot of people get shaken out of positions as breakouts haven't been working as well as they were a few months back when the Nasdaq was surging.
certainly is causing choppiness.... are you yourself, just mainly waiting for pullback continuation plays to reload or are you starting to look at some players in the lagging sectors wh/ are starting to pop their heads up as intial 2a breakouts?
thanks again for all your help