Stan Weinstein's Secrets for Profit in Bull and Bear Markets (PERSONAL FINANCE & INVESTMENT)

Product Information

These include white papers, government data, original reporting, and interviews with industry experts. Legitimate topping patterns show active distribution because strong hands are taking profits and moving back to the sidelines.

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. However, there's no perfect time frame for the completion of a top, making it easy to get caught in poor reward-risk scenarios, especially with short sales looking to profit from a breakdown. Short positions taken early in a downtrend carry higher risk and higher reward than late in the decline. Let's examine the stages, identifying the attributes and outlining the types of positions that work best in each market phase.

Even so, tops display similar characteristics that let traders and market timers make informed judgments about the security's direction. The technical dominoes fall, one after another, while trapped shareholders are forced to capitulate. Registered Representatives associated with this site may only discuss or transact securities business with residents of states they are registered in. Stan Weinstein's stage analysis offers market participants a powerful tool to identify current market conditions and to make rapid adjustments to strategies and risk-management practices. When it happens, the pullback trade offers outstanding reward:riskbecause the transition into the second stage tends to work with reliability, with few failed breakouts, allowing tightly placed stops.

Late-stage downtrends can turn into wars of attrition, with participants moving on to other opportunities. Disillusionment and loss of faith characterize this uncomfortable period, which can take a long time to work through the system. You can find out more about our use, change your default settings, and withdraw your consent at any time with effect for the future by visiting Cookies Settings, which can also be found in the footer of the site. The opinions of Financial Sense® contributors do not necessarily reflect those of Financial Sense, staff, or parent company, Financial Sense® Wealth Management.However, these issues also exhibit greater vulnerability to positive news shocks that reawaken bullish fervor and allow the process of base building to begin all over again. Cookies collect information about your preferences and your devices and are used to make the site work as you expect it to, to understand how you interact with the site, and to show advertisements that are targeted to your interests.