Trade Like a Stock Market Wizard: How to Achieve Super Performance in Stocks in Any Market: How to Achieve Superperformance in Stocks in Any Market

by Mark Minervini

Stage 4 is essentially the opposite of stage 2 in terms of price and volume characteristics, with higher volume on down days and lower volume on up days. You should definitely avoid buying while a stock is in stage 4. STAGE 4 CHARACTERISTICS • The vast majority of the price action is below the 200-day (40-week) moving average. • The 200-day moving average, which was flat or turning downward in stage 3, is now in a definite downtrend. • The stock price is near or hitting 52-week new lows • The stock price pattern is characterized as a series of lower lows and lower highs, stair-stepping downward. • Short-term moving averages are below long-term moving averages. • Volume spikes on big down days and big down weeks are contrasted by low-volume rallies. • There are more down days and weeks on above-average volume than up days and up weeks on above-average volume