Avoid buying the dip. Look for short-selling opportunities on brief, weak relief rallies. 3. The Power of Moving Averages and VWAP
A central pillar of the book is Stan Weinstein’s four-stage market cycle theory, which Shannon adapted for multi-timeframe execution. Understanding these stages prevents traders from buying into dying trends or shorting strong breakouts. Stage 1: The Accumulation Phase Avoid buying the dip
Stage 2: Markup (Bullish Trend) /\ /\ / \ / \ / \______/ \ / \ Stage 3: Distribution (Top) / \_______ / \ _______/ \ Stage 4: Markdown (Bearish) Stage 1: Accumulation (Bottom) \ / \ / \____/ The Power of Moving Averages and VWAP A
I can provide specific script setups or step-by-step chart examples tailored to your needs. Share public link Share public link Used strictly for tactical entry
Used strictly for tactical entry and exit execution, risk management, and precise stop-loss placement.
Used to identify the dominant market direction and major support or resistance levels. For a swing trader, this is typically the weekly or daily chart.
By analyzing these layers simultaneously, you ensure that you are never fighting the dominant market trend, while still maintaining the ability to enter trades with tight, low-risk stop-losses. 2. The Four Stages of the Market Cycle