RE: Nobody in control13 Feb 2018 15:14
yep Kellogs would term this the Accumulation Stage ( if one follows the Dow Theory ) The Accumulation phase usually occurs right after a steep sell off in the market. The steep sell off in the markets would have frustrated many market participants (myself included) losing hope of any sort of uptrend in prices. The sp would have plummeted to rock bottom valuations, (yep) but the buyers would still be hesitant of buying fearing there could be another sell off (this is your level of equilibrium Kellogs). Hence the CNA sp languishes at low levels. This is when the �Smart Money� enters the market.
Smart money is usually the institutional investors who invest from a long term perspective. They invariably seek value investments which is available after a steep sell off. Institutional investors start to acquire shares regularly, in large quantities over an extended period of time. This is what makes up an accumulation phase. This also means that the sellers who are trying to sell during the accumulation phase will easily find buyers, and therefore the prices do not decline further. Hence invariably the accumulation phase marks the bottom of the markets. More often than not, this is how the support levels are created. Accumulation phase can last up to several months.
Once the institutional investors (smart money) absorb all the available stocks, short term traders sense the occurrence of a support. This usually coincides with improved business sentiment. Bring on the 22/02 .... Borgy