Increasing Volatility Within Uptrend
Note: The historical stock examples given below are for EDUCATIONAL USE ONLY. They ARE NOT to be used to make buy/sell decisions in today's market. For more information, please read the HSR Terms of Use.
Description
Price begins to trade in a more volatile fashion compared to its earlier trend of tight trading.
You can use the rope analogy to better understand this behavior.
At the beginning of a stock's advance, price usually trades tight much like a brand new rope that's tightly wound.
Towards the end of a trend, price trades more erratically like a frayed rope that's unwinding.
Behavior Note: Using a daily chart may help you more closely zero in on the rise of increased volatility.
What you need to know
Volatility tends to increase at tops and the onset of volatility may give you a warning that a stock is under distribution.
Historical Stock Chart Examples 1A-1C: Ceragon Networks (CRNT) 2007
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Click to enlarge 1A
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Click to enlarge 1B
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Click to enlarge 1C
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Please >>CLICK HERE<< to go to the next price behavior within Topping Behaviors.
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