ABSORPTION ... What a key CONCEPT...
Today there was a battle at .039 and .040
which continued on from yesterday
NINE columns in ALL on a One Box Reversal Wyckoff Chart
ABSORPTION
and then ?
There is still a little resistance to the left.
But VOLUME , TIME and PRICE all EXPANDED
Which resulted in the Break of the Channel ( "HOW THE MOVE STARTS" )
It Turned on ~ 100 mil shares. Which confirms this move down as a correction in my opinion.
It could have turned on 200 mil .
What is the Significance of 100 mil Vs 200 mil
Multiple !
But remember the Young Wyckoff and his Boss dealing with the hardware man !
The Lesson of the TECHNICAL POSITION !
Which I tend to put like this.
It won't go up until AFTER you sell and it won't go down until AFTER you buy !
If you do not know who YOU is. Then Be careful it is NOT YOU ! :-)
A quote from RDW-->
Next in importance to knowing what to buy is the question as to when it should be done.
I was discussing this matter with an investor today. He referred to the assets and earning power of a big corporation whose securities had recently suffered a very material decline. He could not understand why the stock should go down in the face of such a showing of commercial and financial strength.
My answer was this:
“You have an automobile — it consists of a lot of steel, wood, rubber, brass, leather and other material. It requires gasoline, water, air and lubricating oil. Also knowledge as to how to adjust the whole piece of complicated machinery so that all the parts will work harmoniously. The smallest thing about your automobile is the spark. Without it the whole mass becomes junk. With the spark at least you can get the machinery to go, and you might plug along. But: Unless your spark is timed to fire at the exact moment when the piston reaches a certain point of elevation in the cylinder, you might as well get out and walk.
“It is the same way with the stock which you just mentioned. The company has ample working capital, high class management, big earning power, wonderful prospects. It is probably in a better and stronger position than when its stock sold thirty points higher. In this case the ‘spark’ is represented by the technical position. At 140 the spark was not properly adjusted. At 110 the adjustment has improved, but a study of the technical position of this stock will eventually point out the exact moment when it should be bought; so get all your other factors lined up ready for the first time when the technical position shows that it is time to buy.”
Never underestimate the importance of the Technical Position.
Richard D Wyckoff
Motorway
And remember==> The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices.
They are OBSERVATIONS for the sole purpose of LEARNING ,DISCUSSION and GENERAL INTEREST.
Motorway
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