ACX Chart, page-963

A trader needs to place at least a degree of value in stock charts to appreciate and use stage analysis in their buy and sell investment decisions. Fundamental analysis can be ok, but it also needs the backing of basic technical conditions on a chart.

Telstra (TLS) is an example of a stock that has been in a stage 4 downtrend for years. TLS price bars as seen on a chart are below a declining 150-day moving average. These are weak stocks that institutional investors largely avoid.

LYC (Lynas) was another stock that went from around $2.30 down to only 4 cents. This is an unusually severe example of a stage 4 downtrend.

Before buying a stock I like to first look at longer time-frames of 24 months, then 12-months, and finally the default display is 6 months. Every chart has a 130-day (26-week) and 200-day (40-week) exponential moving average displayed. These two moving average lines when displayed on a longer-term 24-month chart, displays how the big money is either made or lost.

A stock in a horizontal base (stage 1) gradually breaking out to an up-trend (stage 2) is what I look for when scrolling through the ASX 500 charts on my PC at home at least every second day.

I originally found out about Stan Weinstein's stage analysis via Louise Bedford's Trading Secrets book. I subsequently bought Stan Weinstein's book, Secrets for Profiting in Bull and Bear Markets.

More info:

http://www.nextbigtrade.com/stage-analysis/

https://www.debeurs.nl/Forum/Upload/2012/6160228.pdf