Stan Weinstein's Stage Analysis

This is a discussion on Stan Weinstein's Stage Analysis within the Technical Analysis forums, part of the Methods category; Attached are this weeks major charts for analysis. The Dollar Index and The Treasuries charts are pivoting around their 30 ...

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Old Feb 12, 2012, 12:57pm   #256
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread Attached are this weeks major charts for analysis. The Dollar Index and The Treasuries charts are pivoting around their 30 week WMAs. Whereas Copper had a reversal at it's first major resistance of $4 which it's been trading into for the last 3 weeks and is trading in Stage 1A. If it pulls back here further then the $4 level could become the Stage 2 breakout point to watch for. Gold continues to forge it's very large Stage 3 range and the 30 week WMA has turned slightly positive again for 3 weeks now. The Nasdaq 100 continues to be the leader and is strongly in Stage 2 now, whereas the S&P 500 is still in early Stage 2A and hitting the upper resistance levels.
Attached Thumbnails
spx_weekly_10_2_12.png   ndx_weekly_10_2_12.png   gc_weekly_10_2_12.png  

hg_weekly_10_2_12.png   cl_weekly_10_2_12.png   us_30yr_treasuries_10_2_12.png  

ty_10yr_treasuries_10_2_12.png   dx_dollar_index_10_2_12.png  
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Old Feb 12, 2012, 7:28pm   #257
 
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Re: Stan Weinstein's Stage Analysis

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Originally Posted by isatrader View Post
As we seem to be disagreeing on the current Stage of the S&P 500 I've laid out the sub-stage definitions from the Global Trend Alert Newsletter below and will explain why I personally think it's now Stage 1A.

Stage 1A - Start of a base. Needs much more time.
Stage 1 - Basing Phase. May begin accumulation.
Stage 1B - Late in base-building phase.Watch for breakout.

Stage 2A - Early in uptrend stage. Ideal time to buy aggressively.
Stage 2 - Advancing Stage
Stage 2B - Getting late in uptrend. Watch carefully. But still a hold.

Stage 3A - Looks as if a top is starting to form. Be sure to protect holdings with a close stop.
Stage 3 - The Top Area. Start to reduce positions.
Stage 3B - Has become increasingly toppy. Use rallies for at least partial selling.

Stage 4A - Stock has entered Downtrend Stage. Close out remaining positions.
Stage 4 - The Declining Stage. Avoid on the long side.
Stage 4B - Late in downtrend. Much too soon to consider buying.

Additional ratings
(A) Early in that Stage.
(B) Late in that Stage.
(+) Outstanding pattern in that Stage.
(–) Unexciting pattern in that Stage.

Below is the most recent interview with Stan Weinstein from 12th November 2011. The interview starts around 30 minutes into the recording.

Technician Stan Weinstein: Markets Still in Neutral Territory, Still Opportunities to Make Money Jim

During the interview on 12th November Weinstein says the S&P 500 is in Stage 4B- (Which from the definitions above is - Late in downtrend. Much too soon to consider buying. So it is eight weeks later now and the S&P 500 has since made two higher lows. The 30 week weighted* moving average is flat as has been moving between up an down randomly for the last 8 weeks, with a total of 4 down weeks and 4 up weeks. Currently it has turned up for the last two weeks (see my chart attached). Price has broken out of and held above a 10 month down channel for the first time, although this was during the light volume year end week. Price has also managed to close above the flat 30 WMA for 5 weeks in a row now, so by my interpretation of the method and extrapolating from Stan Weinstein's own rating in early November I think we have now moved into Stage 1A, although it could deserve a minus rating as it is an unexciting pattern in that Stage. So I agree that this isn't a time to be buying or selling until the market moves into either a Stage 4 continuation move (below 1158 for me) or stabilises further into a proper Stage 1 - where he says you may begin accumulation.

*The 30 week weighted moving average - from my study of the book I came to realise that even though he talks about the 30 week moving average. He was actually using the 30 week weighted moving average, as that is what the Mansfield charts he uses for all of his actual examples uses. So this is one of those grey areas from the book that is open to interpretation. Currently if you use the 30 week simple moving average it is still in a downtrend although momentum has slowed. However if you use the weighted 30 week MA - as the Mansfield charts did - the MA has been flattening for the last 10 weeks and has turned slightly up for the last 2 weeks. So to be clear, I'm going to stick to using the weighted moving average as I think this the most faithful to real examples from the book.

As always this is just my opinion from my interpretation of it.
Hello I`m Spanish follower of Weinstein Method, and i decide to follow this thread because they are not many tread following Weinstein Method.

On that interview Weinstein talked about some stock, but i just couldnt understand it. Some of them were ANR, BZO, MHO but the other of the steel sector no idea.

Thanks Isatrader for posting the GTA of 2005 so we can follow the differents between each Stage. And after 10 years in the market i have never seen charts as easy to read, beautiful to watch than yours with the ProTa. Sorry there is not such program for Windows users.

Thanks a lot, and a new follower of Weinstein for the thread ;-) Sorry i don´t have Force Index or Performance Indicator.
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Old Feb 12, 2012, 10:16pm   #258
 
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Re: Stan Weinstein's Stage Analysis

hi guys, thought I would post my first message to say hello. i have read back through all of the posts before posting. i am a relative novice when it comes to investing, but of the books that i have read so far, the weinstein method is for sure the way that i plan to go. i was hoping someone could help me though. I am happy to invest in both uk and us stocks, however at this stage, i am really struggling to find the best website to use to analyse them. so far, i have used mainly google finance, stockcharts.com and also bigcharts.com. these all seem to work ok for us stocks, but i am really stuck on where to get good charts for uk stocks. and then on the best way to assess sectors. any help would be appreciated
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Old Feb 12, 2012, 11:00pm   #259
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread
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Originally Posted by biggnick View Post
hi guys, thought I would post my first message to say hello. i have read back through all of the posts before posting. i am a relative novice when it comes to investing, but of the books that i have read so far, the weinstein method is for sure the way that i plan to go. i was hoping someone could help me though. I am happy to invest in both uk and us stocks, however at this stage, i am really struggling to find the best website to use to analyse them. so far, i have used mainly google finance, stockcharts.com and also bigcharts.com. these all seem to work ok for us stocks, but i am really stuck on where to get good charts for uk stocks. and then on the best way to assess sectors. any help would be appreciated
Hi biggnick, for UK stocks there are a number of options for charts. I use ADVFN for mine, and I know another member on this thread uses Sharescope for his UK charts, both of which are more than adequate for what you need and have all the UK sectors available. Unfortunately with UK stocks there's not many good free options which is why I pay a monthly subscription for the UK stocks as some of the free sites have some bad data I've noticed. But you could try ProRealTime charts which are free and web based. They do have subscription options as well, but I think their UK charts are accurate.

For UK sectors I've posted the list of them a few times in the thread so have a look through and then you can put the ticker symbols into whatever software you choose and save as portfolio.
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Old Feb 12, 2012, 11:14pm   #260
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread
Quote:
Originally Posted by dinapoli View Post
Thanks Isatrader for posting the GTA of 2005 so we can follow the differents between each Stage. And after 10 years in the market i have never seen charts as easy to read, beautiful to watch than yours with the ProTa. Sorry there is not such program for Windows users.

Thanks a lot, and a new follower of Weinstein for the thread ;-) Sorry i don´t have Force Index or Performance Indicator.
Thanks for posting dinapoli. I'm glad you like the thread. It takes a lot of effort, but I think it's really helped me to focus and develop my understanding of the method further and I hope it's helping other people as well. Feel free to contribute anytime or ask questions as talking about it really helps us all I think.
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Old Feb 12, 2012, 11:25pm   #261
 
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UK Sectors

isatrader started this thread As we were talking about UK sectors I thought I'd post the latest Weinstein style charts for stage analysis.
Attached Thumbnails
uk_sectors_list_10_2_12.png   uk_sectors_1_10_2_12.png   uk_sectors_2_10_2_12.png  

uk_sectors_3_10_2_12.png   uk_sectors_4_10_2_12.png   uk_sectors_5_10_2_12.png  

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Old Feb 13, 2012, 10:51am   #262
 
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Re: Stan Weinstein's Stage Analysis

cheers isatrader, that was a big help. I've decided to get pro real time, so just playing around with it now to see how it works. i don't suppose you have to hand the ticker symbols for the US sectors? not sure if you have posted before or not.
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Old Feb 13, 2012, 11:06am   #263
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread
Quote:
Originally Posted by biggnick View Post
cheers isatrader, that was a big help. I've decided to get pro real time, so just playing around with it now to see how it works. i don't suppose you have to hand the ticker symbols for the US sectors? not sure if you have posted before or not.
Stockcharts has the US sectors listed and I'm not sure if it's the same in ProRealTime as most of the programs use different tickers when it comes to sectors. Do a search in Stockcharts for just the dollar symbol "$" or use this link StockCharts.com - Free Charts - Symbol Search and then scroll down to $DJUSAE Dow Jones US Aerospace & Defense Index. There's a 160 or so sectors listed alphabetically under that.
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Old Feb 13, 2012, 3:21pm   #264
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread Apple's (AAPL) hit my measured move target of $499 in the pre-market trading from the 18th Jan post http://www.trade2win.com/boards/tech...ml#post1769334

So I'm moving to neutral on Apple for the time being as my price objective has been achieved and the probability is increased of it consolidating around the 500 level for a while. That doesn't mean I don't think it will or could go higher in the medium term, but just that my short term target has been met.
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Old Feb 18, 2012, 12:08pm   #265
 
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Re: Stan Weinstein's Stage Analysis

I think Apple made a Big Reverseal.... althoug is still so bullish....... that they are no big signals of weakness. I think that Apple should take a break........ and i dont see it going towards 700 with no rest....... or decline toward 420 or a bit lower.
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Old Feb 18, 2012, 12:49pm   #266
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread Attached is the latest US Industry sectors. Technology (XLK) continues to lead in Stage 2 and Consumer Discretionary (XLY) stocks are still the next strongest in Stage 2 and are continuing to make new highs. Consumer Staples (XLP) has turned around the last three weeks after consolidating around the Stage 2 breakout level for all of January.

As a whole the sectors picture is looking more positive though, with even the worst sectors in Stage 1 now, and almost half of the sectors in either early Stage 2A or breaking out to new highs in Stage 2.
Attached Thumbnails
us_industry_sectors_17_2_12.png  
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Old Feb 18, 2012, 7:23pm   #267
 
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Re: Stan Weinstein's Stage Analysis

isatrader, over the last week or so I have been using pro real time to analyse uk stocks as you suggested, and it is making a lot more sense now and i feel a lot more confident in being able to pick some good winners. however, my question in relation to uk stocks, is do you think that volume confirmation is as important as it would be for us stocks? the reason i ask this, is looking back on some of the charts, ones that have had a 400%+ gain in little over a year, did not have any significant increase in volume. now obviously, i would say that if the volume confirmation is there, then thats even better, but do you think when dealing with uk stocks, it would still be ok to buy without that confirmation or is that a no no?
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Old Feb 18, 2012, 8:21pm   #268
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread
Quote:
Originally Posted by biggnick View Post
isatrader, over the last week or so I have been using pro real time to analyse uk stocks as you suggested, and it is making a lot more sense now and i feel a lot more confident in being able to pick some good winners. however, my question in relation to uk stocks, is do you think that volume confirmation is as important as it would be for us stocks? the reason i ask this, is looking back on some of the charts, ones that have had a 400%+ gain in little over a year, did not have any significant increase in volume. now obviously, i would say that if the volume confirmation is there, then thats even better, but do you think when dealing with uk stocks, it would still be ok to buy without that confirmation or is that a no no?
I had a similar chat about the volume confirmation recently on email with another trader. If you go to pages 103-108 in the book and re-read that section you'll see that the volume confirmation he talks about isn't usually present until the stock breaks out. There is an ideal volume chart on page 104, and if you cover up the portion of the chart from the breakout onwards, you'll see that the volume increase isn't present before the breakout at all. So although a hugely important part of the method, it's not something that is visible until after the breakout. So the idea is if the volume doesn't increase in a meaningful way then it's less likely to become one of the exceptional winners and has more risk of being a false breakout, so he suggests taking a quick profit and looking for another stock instead. Very few stocks get the large increase in volume and become exceptional winners, but the idea is to position yourself accordingly so that you can catch them when they do occur.

As for UK stocks, volume is harder to gauge as they are much less liquid than US stocks and even stocks in the FTSE 350 can be very thinly traded. So I find the volume aspect harder to read in UK stocks. This is one reason why I've chosen to focus my portfolio on large cap US stocks in the S&P 500 as the volume is significantly larger and they are all very liquid. I do trade UK stocks and currently am in Rolls Royce since November, but am mostly in US stocks and currencies at the moment. theblackmamba focuses on the UK stocks, so maybe send him a private message as we've talked about a lot of these issues at length on email.
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Old Feb 19, 2012, 2:40am   #269
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread Attached is the updated major charts for analysis. The US 30 year Treasuries is the key one for me to watch as the price is sitting exactly on the 30 week weighted moving average after a fairly lengthy consolidation period since the September 11 high. I'm rating it Stage 2B- now as it's right on the cusp of becoming Stage 3A if it breaks down and closes below the $140 level or it could pivot on the moving average and breakout into a continuation move. However, it's given a few more negative signs on the weekly chart as the Mansfield relative strength has crossed into negative territory this week and the cumulative volume has moved below it's moving average for the first time since it crossed above it in March 2011 indicating that volume is beginning to slowly leave the 30 year Treasuries. Finally relative performance versus the S&P 500 has given a negative signal by moving below it's October low.

Crude Oil is another interesting chart and I'm rating it Stage 1B now following last weeks price action.
Attached Thumbnails
spx_weekly_17_2_12.png   ndx_weekly_17_2_12.png   gc_weekly_17_2_12.png  

hg_weekly_17_2_12.png   cl_weekly_17_2_12.png   us_30yr_treasuries_17_2_12.png  

ty_10yr_treasuries_17_2_12.png   dx_dollar_index_17_2_12.png  
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Old Feb 19, 2012, 9:22am   #270
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Re: Stan Weinstein's Stage Analysis

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...Crude Oil is another interesting chart and I'm rating it Stage 1B now following last weeks price action.
isa, Crude shows a problem with Weinstein system on very well publicised instruments, I think, that when the world is very bullish on something, the chart looks too perfect, and money looks easy, there is suspicion of being suckered in. http://tinyurl.com/77rfpbx
Assuming it (and USO) fully break next week, it does not have an "investor" feel to it, I think.

(P.S. USO is a weak CL tracker ETF, but is what many people will buy, rather than CL. http://tinyurl.com/7wq2po8 )

Last edited by lplate; Feb 19, 2012 at 9:56am. Reason: USO sentence
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