Hiya espiaz, getting that kind of analysis to work on the spec end of the market is something I spend a fair amount of time trying to do. Whether something is going to be a P&D (pump and dump) or a more sustained run, I don't think there is a set rule to determine it (if there is I have not seen it), it is not something immediately obvious or we all would be rich. But I think you can get a feel for it with experience. Sometimes it is given away in the fundamentals of the company, and the reason (or total lack thereof) it has started running. Another way you'd hear is always look further to the left on a chart, quite often you will see indications of what kind of movements are typical for this stock, and while they do not always repeat themselves and there are exceptions to every rule, a stock with a history of P&D's has a higher chance of more in the future.
The lower of your charts, without having any idea what it is, I imagine was driven by a strong fundamental shift (I'd guess it's a Lithium explorer going by those dates), like the an acquisition or strong initial results from a drilling campaign. Knowing what kind of news drives certain kinds of changes in share prices can be valuable here. You will find all sorts of newsflow are hyped up, but it's good to have an idea of if they are actually likely to re-rate the company immensely, if it is something that is more fluff and hype that may be years off making an impact on the company, or something that has already been priced into the SP and some holders are just sitting there waiting to sell on the expected news. Does not hurt to have a cynical eye when reading about companies when it comes to positive forward looking remarks
It can also depend on the sector interest and market sentiment. If a sector is very hot like Biotecs have just been, you can see a lot more of the excessive rises, and thus larger corrections partly due to the increased interest from traders adding to that volatility.
I do think it is not a bad idea to take time out during market periods like this is you aren't comfortable with the volatility, it's what I did earlier in the year a bit after the Feb fall, took some time out, did some studying and research and wrap my head around what was going on, and glad I did.
If you are looking for something similar to VPA, Jako8557 has some great stuff about VSA and Wyckoff, which are effectively the same principles which you may find helpful reading about. https://hotcopper.com.au/threads/hot-copper-charting-and-chat.4433639/?post_id=35611124
Anyway, just some Saturday arvo ruminations with not nearly enough caffeine yet in the system.
(20min delay)
