Back on July 19th, I noted in this post that there were serious signs of accumulation, or buyers of size, layering into small cap quality stocks like BZ and HHC. Though it was a bumpy right into August, you can indeed see below on the updated daily charts for both stocks that they are now powerfully emerging from multi-month corrections and subsequent consolidations.
As I explained back then:
“Accumulation” is the process of buyers gaining control from sellers after a prior corrective or bearish trend of lower highs and lower lows. Observing the volume pattern on daily and weekly timeframes is one tool at your disposal in attempting to identify signs of accumulation. Strong signs of accumulation raises the specter of a major reversal in trend. However, price is king and must make progress in conjunction with volume.
I would be looking to stalk these stocks upon any pause going forward, as long as selling volume and price swings do not get so out of hand as to negate the breakouts.
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