Stan Weinsteins Secrets Profiting Bull Bear
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The chart below (compliments of tradersnarrative.com) shows the similarities between the recent Nasdaq bear market compared to the Dow Jones bear market of 1929 and their respective aftermaths. So far the charts are eerily similar and suggest that, just as what has been described above, we may well Trading 212 Cfd Broker Review experience a further run-up in the Nasdaq before Stage 4 is complete and Stage 1 begins. Such forecasts are not surprising for those who adhere to Stan Weinstein’s 4-stage technical approach to determining market trends as put forth in his book “Secrets for Profiting in Bull and Bear Markets”.
For more information about Stage Analysis, see Brainy’s eBook Article ST-6410, « Sample trading strategies – Weinstein » , and you can refer to Weinstein’s book, « Secrets for profiting in Bull and Bear Markets ». If you’d like us to email you if / when this book is back in stock, please close this window and click the ‘Notify Me’ button. It could be that it’s a really popular title and we’re simply waiting for the publisher to print and supply more stock. Some good recommendations on the book list and your “beliefs” are quality…Applying some of those more frequently would certainly have helped me over the years. Our library is the biggest of these that have literally hundreds of thousands of different products represented.
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A trading range occurs when a security trades between consistent high and low prices for a period of time. Trend trading is a style of trading that attempts to capture gains when the price of an asset is moving in a sustained direction called a trend. Meanwhile, « there’s a little bit of a glimmer of hope on a short- to intermediate-term basis three to four weeks from now, » he said. « But don’t buy the good stocks yet, don’t sell them short either — and don’t buy the crummy groups even though they may have a bounce upward. » In Morgan Stanley Europe’s research stage 3 is referred to as that of a shallow correction and their research revealed that this period lasts almost as long as the rebound rally i.e. 17 months or so. While Weinstein’s chart above starts with the uptrend the Morgan Stanley chart below starts with the Bear Market .
Keep in mind that these concepts are time-frame independent, meaning they work equally well on intraday, daily, weeklyand monthly time-frame charts, making them excellent supportive tools for traders, market timers, and long-term investors. The public tends to focus exclusively on Stage 2, or the uptrend stage, looking to buy high and sell higher. People are confused when conditions change, no longer favoring the long-side strategies they adapted from popular books or websites. A brief education on Weinstein’s principle lowers the risk associated with this myopia, enabling traders to make informed decisions when markets turn against their positions, as they do during ranges, correctionsand downtrends. Stan Weinstein outlined the principles of stage analysis in his 1988 book, Stan Weinstein’s Secrets For Profiting in Bull and Bear Markets. Well, with a distribution phase of 17 months, on average, followed by a down-trend phase of 30 – 34 months, mean and average respectively, we might well see a bottom somewhere between June, 2014 and October, 2014.
Week Moving Average (ma)
However, high volatility also forces securities to fall far more rapidly than they rose, allowing perfectly timed short positions to book windfall profits. The middle of Stage 2 often prints a high-volume continuation gap that marks the halfway point of the uptrend. This surge to higher ground also signals the formal introduction of weaker hands into the trade. Accumulation tends to speed up near the end of the pattern, triggering a set of higher-than-average volumespikes that show enthusiastic buying interest.
But when he went back to price action he made a killing including making a fortune during the stock market crash during the Great Depression. In Weinstein’s Basing Area, or accumulation period, as buyers and sellers start to move into equilibrium the 30-week moving average loses its downward slope and starts to flatten out. In addition, intermittent rallies and declines move prices above and below the MA. This basing area can go on, according to Weinstein, for months, if not for years in some cases. Indeed, according to Morgan Stanley Europe’s findings, this trading range lasts, on average, 5.6 years. Below is a chart showing the Weinstein stages with basic technical terms applied to the full cycle.
By Stan Weinstein
Each of these stages generates a variety of trading and investment opportunities that capitalize on current conditions. As the months proceed more and more investors become aware of the rising trend and jump in. In Weinstein’s Advancing Phase, or uptrend, the 30-week MA starts to curve upwards, slightly at first, and this is followed by consecutively higher highs and higher lows as more buying takes place and others take their profits, albeit too soon. The best technical analysis being done by the best technicians in the world every day. Finally Mark Minervini’s books and Brad Koteshar’s book are a good complement to Stan Weinstein’s material .
In order to read or download stan weinsteins secrets for profit in bull and bear markets pdf ebook, you need to create a FREE account. The breakdown marks the start of the Stage 4 downtrend, when sellers control price action, often dropping securities to depressed levels unanticipated by optimistic bulls. Disillusionment and loss of faith characterize this Stan Weinstein’s Secrets For Profiting in Bull and Bear Markets uncomfortable period, which can take a long time to work through the system. The stage often begins on high volatility but ends on low volatility because apathy and disinterest have taken their toll, dropping the security’s volume to cyclical lows. A mature top tends to lose elasticity, with price bars failing to reach the upper half of the range.
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Toolbox Members can see details and comments in the latest chart in theToolbox Member’s Area. It is also interesting to understand that Weinstein developed and tested his approach over a long period of time, and when computers were only scarcely available. And the computers that he might have had ready access to were probably the text-based version .
Like Weinstein the core strategy of their systems uses price action and volume. Minervini uses some fundamentals as well making his system SEPA similar to CANSLIM. All of the books are extremely well written and have tons of investment nuggets of wisdom. Late-stage downtrends can turn into wars of attrition, with participants moving on to other opportunities.
Trading With Stage Analysis
Weinstein is making the rounds to promote his book, Stan Weinstein’s Secrets for Profiting in Bull and Bear Markets. And he said this week that little has happened since Oct. 19 to change that stance. He sneers at suggestions that the current market environment is just a pause in the roaring bull market that began in 1982, just as he sneers at the view that the present bear market will soon give way to another big, bullish advance. To put things in proper perspective, according to Morgan Stanley’s research, the least decline of the past 19 secular bear market was 44% over a 13 month period ; the worst decline was an 86% decline over 32 months between Oct.’29 and June’32.
New uptrends tend to attract a small group of committed buyers at the beginning and a big group of weak-handed chasers and followers closer to the end. In turn, the early phase of an uptrend tends to elicit well-organized price actionwith a graceful series of higher highs and higher lows, while a late-stage uptrend tends to spit out all sorts of traps, stop-running and failure swings. This happens because market insiders take notice of the developing uptrend and use their special skills to shake out weak hands and late adaptors. The book organizes market action into segments that evaluate price dynamics within a continuous cycle of bottoms, breakouts, uptrends, tops, breakdownsand downtrends.
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On-balance volume and other accumulation-distribution tools bottom out with price and turn higher, reflecting the newly bullish technical outlook. Watch closely when these indicators show greater upside than price action within the base, because this can signal an impending breakout that sets off Stage 2. Let’s examine the stages, identifying the attributes and outlining the types of positions that work best in each market phase.
This limp price action exposes waning interest by the few enthusiastic buyers left in the system, in turn allowing gravity to take control. Intermediate moving averages start to align with key support levels, adding energy to the subsequent breakdown, which sets off a positive feedback loop. The technical dominoes fall, one after another, while trapped shareholders are forced to capitulate. Legitimate topping patterns show active distribution because strong hands are taking profits and moving back to the sidelines. As with bottoms, OBV and other accumulation-distribution tools measure this process with great accuracy, especially when bearish volume activity leads price to the downside.
The Weinstein stages are based on an assessment of market dynamics while the Morgan Stanley chart depicts the actual reality of it all. Morgan Stanley Europe and Merrill Lynch Asia reports released within the past month both support the on-going upswing in the S&P 500 and other market indices around the world suggesting that this current bull run is far from over. Robert Brain provides various support to both new and experienced traders and investors. Stan actually had a fundamental background when he first got into the markets but says in the book once he discovered that wasn’t working well shifted to the technical approach. This same theme I’ve seen with other famous traders like Nicholas Darvas and Jesse Livermore.
FYI the decline in the U.S. between March’00 and Sept.’03 was 49% and the one between May’73 and March’74 was -48%. The worst in both severity of decline (-73%) and duration of correction happened in Spain between May ’74 and May ’80. Weinstein refers to this stage as the Top Area or distribution phase during which the trend loses its upward momentum and starts to trade sideways. As a market there are an equal number of buyers, who are late to the party, and sellers, who are aware that it is time to take their winnings off the table. And, whereas those declines in stage 2 all held above the MA, in Stage 3 the index straddles the MA, above and below it at various times. Such market cycles have been the norm over the past 80 years of Morgan Stanley’s research period.
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What does the application of the above analyses, research, hypotheses and interpretation on future market direction mean for gold, silver, crude oil, the HUI and the CDNX (as a proxy for commodity-related stocks with warrants). as discussed in my article last week and identified in the chart above we might see a low of 400 by January 3rd, 2014. Robert analyses the Australian market on a weekly basis, and includes a weekly update of this type of chart.
