Markets move through recognizable phases, regardless of headlines. When traders focus on news instead of structure, they often miss what price is clearly communicating.

Price action tells the story in real time.

The four stages of a market move

Markets typically evolve through a sequence of stages.

• A downtrend marked by lower highs and lower lows
• A basing phase with sideways action and crisscrossing averages
• A transition with a higher high above a flat to rising 200-day (or 40-week) moving average
• A confirmed uptrend

Understanding these stages keeps traders aligned with structure instead of stories.

Why headlines arrive late

By the time headlines feel convincing, price has often already moved through the most important phase.

• News tends to surface during distribution, not accumulation
• Big names buying does not stop selling pressure
• Someone is always on the other side of the trade

Public confirmation usually follows price, not the other way around.

Important note

Distribution is only obvious after support breaks. Until then, it can look like a pause.

Price decides which it is.

Why picking bottoms is costly

Repeated attempts to buy perceived value during distribution take a toll.

• Rallies can occur inside downtrends
• Ten percent bounces feel rewarding but are short-lived
• The mental and financial cost adds up quickly

Short-term gains do not change long-term structure.

Caution

Even well-known buyers can be early or wrong. Large ownership does not guarantee control if selling pressure is stronger.

The takeaway

• Market stages are visible in price
• News confirms narratives after the move
• Distribution is only known once support breaks
• Price action matters more than headlines

Listen to price action. Let structure guide decisions – not the news.