RE: Stan Weinstein's Stage Analysis and Market Breadth - Technical Analysis
(2020-04-29, 03:38 PM)isatrader Wrote:(2020-04-29, 03:25 PM)marry123 Wrote: This is the big weakness with the stage analysis method after a market crash, having to wait and watch stocks go up 50-75%+ waiting for the S+P to get over the 30 MA weekly. My worry now is that it makes it over the 30 MA weekly as more and more get bullish then it takes the next leg lower which would mean the smart money bought in March on extremely oversold indicators and made huge returns while stage analysis folks who follow the Weinstein method religiously sit and continue to wait and then risk buying right before the next leg lower (if there is to be a next leg lower).
Every method has strengths and weaknesses. Stage Analysis is not about catching bottoms. But if you traded it right then you would have been rotated into others areas of strength as stocks weakened like gold or treasuries while the market was falling. Or you would have captured the far bigger down move by shorting the Stage 4 decline in individual stocks.
I feel like you're focusing on the far smaller up move, as the majority of markets and stocks remain heavily down from where they were in February. So although the bottom fishers have done great in certain stocks. They are probably still sitting on heavy loses to their portfolios as they were likely fully invested in February.
All valid points you make. Yes, I have been focussing on the up move in the NASAQ and S+P watching many stocks make very large moves higher; however, if we do get over the 30 MA on S+P and DOW then maybe that will be the signal that this is indeed a new bull market starting with much higher highs to come and that this was not just a strong bear market bounce.