(This post was last modified: 2021-07-15, 07:50 AM by Lebo44.)
RE: Stage Analysis Beginners Questions
(2021-07-15, 03:50 AM)yellowcup Wrote: My question is, how can we differentiate a Stage 2B on a Stage 3.
For me the answer is simple.
Stage 2B - both 30MA and 10MA are trending upward (and pointing up). 2B means a strong uptrend so all key MAs must be going up (this is simple trading strategy, Minervini has the same criteria for estimating uptrend). Also all MAs in correct order: 10MA > 21MA > 30MA etc.
Stage 3A (early Stage 3) - 30MA is losing momentum and is flattening (or even slightly pointing down in the last weeks) and 10MA is pointing down (even more than 30MA because it is faster MA). There could be also signs of distribution: big red bars with very high volume, kind of exhaustion gap, stock very extended and selling visible (many red bars in a row). See attached Starbucks example (around the week marked by the dotted line) - notice flattened 30MA (yellow) and 10MA (white) lost momentum and going down