One question people regularly ask: How can we know in real time that stock has ended its uptrend?
When a Bullish stock sells off Big on a single day or in a single week with a huge huge volume.
Let me share one case study to illustrate the point: Dr Reddy Stock
Dr Reddy stock was in a strong strong Bull market between CY2011 and CY2015. It formed a base at 100 week ma and then took off in a huge way
Everything was going great for Dr Reddy but then this happened
Dramatic fall in Dr Reddy stock
— Deepak Singh (@smarket) November 6, 2015
And the selling continued with volumes
Stock prices take the stairs while going Up, but use Elevator while moving down. Here's one example: Dr Reddy stock pic.twitter.com/pgOsZ0oaeI
— Deepak Singh (@smarket) November 10, 2015
I remember...the moment stock falls...Value Buyers start jumping...oh its a Value Buy. But see now 1.5 years have passed...and Dr Reddy today broke even another support and it's not looking good.
The idea is very simple...When a stock sells off like this...it generally means disruption of trend. Then do not look for Value...just do this because when trend ends....there is no point fighting
Do Share your comments if you agree/disagree and Please share this with your friends.
How Charts help you understand the world we live in - A Crude Story?https://t.co/PaQ9CZrTGa
— Deepak Singh (@smarket) March 9, 2017
Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers