The Handbook of Technical Analysis + Test Bank_ The Practitioner\'s Comprehensive Guide to Technical Analysis ( PDFDrive )

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Market Phase Analysis


figure 4.2 The Three Phases in a Primary Bull Trend on the Daily Chart of the Dow
Jones Industrial Average Index.
Courtesy of Stockcharts.com

figure 4.3 The Three Phases on the 15‐Min EURUSD Chart.
Source: MetaTrader 4

accumulation phase Accumulation normally occurs after a deep and rapid de-
cline in prices. Companies tend to underperform with the release of very negative
data, exacerbated by extremely bearish media headlines and news. The unsophisti-
cated or uninformed market participants are usually extremely bearish at this point,
desperately and frantically selling off all shares in the market at whatever price is
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