[isatrader]

I have a question on stage 2B / stage 3A, which relates to continuation moves/patterns in the middle of a stage 2 move. Are continuation patterns classed as stage 2B, potentially forming into a stage 3A until a breakout of the continuation is made to the upside, from which it then becomes a stage 2A again and stage 3A is taken off the table. Is that how this area of the stage analysis evolves and is classified?

Continuation patterns aren't necessary classed as Stage 2B, as they occur throughout the Stage 2 advance, as you'll often get multiple smaller continuations within a Stage 2 advance. The B rating simply means "Late in that Stage", so you have to use your judgement based on the length of the time it's advanced. But if you go back to page 18 of the book, Weinstein refers to his investing time frame as up to 12 months, so a simplistic time reference for Stage 2B could be 8 months or longer, but I prefer to use the continuation moves as a guide personally, and so I'd say roughly anything after the second significant continuation move in Stage 2 would be classed as Stage 2B. But that's just my opinion from my experience of the method.

I've attached a rough diagram below to demonstrate what I mean.

   

One technique I use to help differentiate a Stage 2 consolidation pattern with the beginnings of a Stage 3 pattern is to look at the technical attributes of the key moving averages and the relative performance. So for example if the consolidation is forming way above a still strongly rising 30 week MA with still strong relative performance, then it's more likely to make a continuation move, as it still has the momentum, and the technicals will still be in the green. But if the consolidation is forming closer to the 30 week simple MA, and makes a close below the 30 week "weighted" MA, which then turns negative, and relative performance is weakening too, and momentum begins to wane, then I'd consider it as moving into Stage 3A.

So for example with your TW.L example, the technical attributes weakened significantly in September when it closed below the 30 week MA for a single week, and so it moved into Stage 3A. However, it managed to move above the 30 week MA again and consolidated until the new year, before it managed to breakout into a new continuation move, which made some headway for a few months, but looks to be stalling now, as it's fallen back to the retest breakout level for a second time.