Correlation of price movementTHESE ARE TWO THEORIES. THE FIRST IS ACCORIDNG TO WYCKOFF, THE SECONS IS THE DOW THEORY
1) Accumulation begins with the price stopping and the formation of support, followed by the end of sales, the opposite level is gradually formed - resistance
and the price goes into a sideways movement. It has a name - Accumulative flat or consolidation. Dow says that it is impossible to trade in flat, this is not a place to trade
2) Consolidation ends when there is an update of the tops and someone from the sides - buyers or sellers, starts winning in the market, but it is quite difficult
to break through from the first time and often a large player deceives the players in this way by making a false breakout.
3) Wyckoff's theory mentions retests of the support level, a sequential movement that follows a stop. Assessment of the state of the lower limit of accumulation,
after which the market reverses and moves in the opposite direction to the previous movement. The accumulation is exited and the trend is reversed.
TREND
In essence, a trend is the direction of the predominant movement of indicators. Usually considered in the framework of technical analysis, where the direction
of price movement is implied. Charles Dow noted that in an uptrend, the subsequent peak on the chart should be higher than the previous ones, in a downtrend,
subsequent downturns on the chart should be lower than the previous ones. There are upward, downward and sideways trends. A trend line is often drawn on the chart,
which connects two or more price troughs in an uptrend, and connects two or more price peaks in a downtrend.
