We have all heard that the economy works in cycles, and so does the market. But what does this truly mean? Has anyone actually been able to show you where you can see these cycles occur? Well, here is a great graph that will show you how. By looking at the 6-month time frame, the percentages of stocks above the 20 daily MA, you are achieving 2 things.
Seeing...
Markets trend. Those trends can be divided in 3 + 1 phases:
Phase 1: Other names include Accumulation/Reversal/Wave 1
No one really know we are in phase 1 until much later.
Phase 1 is very often followed by a deep correction. This was spotted by Elliot (from Elliot Waves) as well as Dow I think?
From the market itself this appears to be true. We can see it...