Lesson / WY-03-13
The Automatic Rally (AR) is the first important upward reaction away from the stopping area after selling pressure temporarily eases. 'Automatic' means only that reduced downward pressure creates room for an opposing move. It neither excludes new buying nor proves a trend reversal. Short covering and new buying can drive the rise, while profit-taking by longs entered near the lows may limit it; all can occur during the AR. Public price and volume cannot determine the purpose of individual trades. Assess the AR's progress and subsequent pullback to judge which interpretation best fits later action.
Course content is for learning and research only. It is not investment advice.
Read the Chapter ↗Timestamps
8 lessons · Chapter contents
01Phases and Events in the Accumulation Schematic↗02The Task of Phase A: Has the Decline Stopped?↗03Preliminary Support: PS↗04Selling Climax: SC↗05Automatic Rally: AR↗06Secondary Test: ST↗07Establishing and Revising Preliminary Range Boundaries↗08Nonstandard Phase A Structures↗Observe the market: start with context and place price within its structure.
Understand structure: compare supply and demand, and let evidence support or revise your hypothesis.
Form a view: define risk limits and know when to reassess.
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Phase B: Tracking Supply and Demand Within the Range
Phase C: Springs and Supply Tests
