How often do you look at a stock that's trading sideways in range and figure it's accumulation, no it's distribution; is it both??
Had a look at IPL because it's mentioned at the beginning of this thread and wanted to see how it panned out.
So we have a "dirty spring" out of a trading range on volume until supply gets encountered, price then retreats on volume back to the previous resistance which then becomes support, it's sits on the support on low volume which usually signifies distribution, it then rises on low volume which usually signifies supply has been cleaned out and accumulation.
Then we hit supply at the top of the range on medium volume before retracing and stopping mid range on medium volume, bounce up on low volume again indicating supply vaccuum, before gapping down on some of the highest volume to date (shakeout?) before a 2 bar reversal on similar volumes.
Next we have a wide spread bar on similar volume to the breakout again encountering supply, followed by another with slightly higher volume and a slightly tighter spread.
Price then breaches the resistance but is beaten back on low volume, it then tries to break through on higher volume but is beaten back to mid range which is defended on varying volume, until it's beaten back to the lower of the range cracking the ice but still showing signs of support.
To my understanding when trading in a range for accumulation - volume will be higher at the bottom of the trading range and the down bars as the market operator supports the price while absorbing selling, and lower at the top of the range as they take their foot off the gas so that they can keep accumulating, and vice versa in distribution.
So what gives with IPL, we have elements of both, gaps, and just general schizophrenia.
Turns out that on 20/3 Harris Associates (a sub with 10.49%) announce they have been distributing since mid December and have sold about 17M shares (1%). The same day Blackrock announces they have been accumulating since mid November both on and off market and are now a sub with 84M shares (5%).
And just to muddy the waters on 24/2 as well as announcing the CEO will step down in 12 months there was a BAML investor presentation. 27/2 Macquarie puts a $3.95 target on it. And on 21/3 Morgans puts a $3.70 price target on IPL.
Next time you're struggling with accumulation or distribution - it might be both.
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