Weinstein Stage Analysis with a Weekly Moving Average

Summary

This ProRealTime indicator translates Stan Weinstein's four-stage market cycle into candle colors using weekly prices and a weekly simple moving average. Stage 1 represents basing, Stage 2 an advance, Stage 3 a topping phase, and Stage 4 a decline. A white line shows the weekly average on the chart, so the longer-term context can be viewed on a daily or intraday chart.

A Stage 2 transition requires the full weekly candle body to clear the moving average plus a configurable buffer while the average rises; Stage 4 uses the corresponding condition below the average while it falls. Between those triggers, the state persists into the associated topping or basing stage. Weekly values update only after a completed bar, which the author says avoids repainting during the week. The defaults are a 30-week average and a 5% buffer, both adjustable. This is a visual trend-following aid, not a tested trading system; the document supplies no performance evidence, and its stage labels are simplified rules for interpreting market cycles.

Key ideas

• The indicator classifies price action into Weinstein's four market stages using weekly data.
• A rising weekly average and a candle body above a buffered average trigger Stage 2.
• A falling average and a candle body below the lower buffer trigger Stage 4.
• Stage state persists between transition triggers, and completed weekly bars are used to stabilize signals.
• The 30-week average and 5% buffer are defaults that users can change.
• The document presents no backtest or evidence of profitability.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.