--- title: "Stage 2 Stock Analysis: How to Find Stocks in a Mark Minervini Uptrend" description: "Stage 2, Trend Analysis, Weinstein" url: https://easyswing.trading/blog/stage-2-stock-analysis-minervini-uptrend updated: 2026-03-28 --- # Stage 2 Stock Analysis: How to Find Stocks in a Mark Minervini Uptrend *9 min read | March 2026 | Tags: Stage 2, Trend Analysis, Weinstein* ## What is Stage Analysis? Stan Weinstein's Stage Analysis is a market cycle framework that divides the life of any stock (or market index) into four distinct phases: - **Stage 1:** Basing/accumulation — price moves sideways after a decline, volume dries up - **Stage 2:** Advancing — the big move; price trends upward with rising moving averages - **Stage 3:** Distribution/topping — price stalls, choppier action, institutions selling - **Stage 4:** Declining — downtrend, price below falling moving averages The core insight: **you want to buy in Stage 2 and only Stage 2**. Buying in Stage 1 is premature; buying in Stage 3 or 4 means you're fighting the trend. As Weinstein wrote in *Secrets for Profiting in Bull and Bear Markets* (1988), "the single most important rule is to never buy a stock in Stage 4." ## The Stage 2 Criteria A stock is in Stage 2 when: 1. **Price is above the 30-week (150-day) moving average** 2. **The 30-week MA is sloping upward** 3. **Price is above the 10-week (50-day) MA** 4. **The 50-day MA is above the 150-day MA is above the 200-day MA** (MA stack) 5. **Volume trend is rising** — more volume on up-days than down-days over the past 3 months Minervini extended this with his specific uptrend template (SEPA — Specific Entry Point Analysis), adding conditions like: - The 52-week high must be within reach (stock within 25% of its 52-week high is ideal) - Relative strength rank must be 70+ (ideally 90+) - Earnings trend must be positive ## Why Stage 2 Matters The reason Stage 2 is so important is compounding probability. When a stock satisfies all Stage 2 criteria: - **Institutional investors** have already been accumulating (hence the Stage 1 → Stage 2 transition) - **The trend is your ally** — you're not trying to guess a bottom, you're riding momentum - **Risk is lower** — a stock in a confirmed uptrend with a rising 200-day MA provides a natural backstop; if the MA starts turning down, you have an exit signal Empirically, the majority of the biggest winning stocks show Stage 2 characteristics at the time of their major breakouts. According to a study by Investor's Business Daily, **9 out of 10 stocks** that gained 100% or more in 12 months were in Stage 2 — above their 200-day MA with the MA stack confirmed — at the start of their move (IBD, *How to Make Money in Stocks*, O'Neil, 4th ed., 2009). ## Moving Average Stack: The MA Stack Check EasySwing automatically checks the "MA stack" — the hierarchical ordering of moving averages that confirms Stage 2: ``` Price > 50-day MA > 150-day MA > 200-day MA ``` If all four conditions are true and the 200-day MA is trending upward (slope > 0), the stock receives the **S2** (Stage 2) tag. This is one of the first filters EasySwing applies — stocks not in Stage 2 are deprioritised regardless of other signals. ## The Stage 1-to-2 Transition The most explosive moves often happen right at the transition from Stage 1 (base) to Stage 2 (uptrend). The signal is a **high-volume breakout above the Stage 1 base** — the stock clears a long-term resistance level with conviction. What to look for at the transition: - A base of at least 3–6 weeks (the longer the base, the more powerful the breakout) - Volume on the breakout day should be 2–3× the 50-day average volume - Price closes in the upper half of the day's range - The RS line (relative strength vs S&P 500) makes a new high before or on the breakout day ## Stage 2 in Different Market Environments Stage 2 analysis works across all market caps, but works best for small and mid-cap stocks where institutional ownership is lower (less efficient pricing). EasySwing focuses on stocks with market caps between $200M and $20B — the sweet spot for swing trading returns. In a broad market downtrend (Stage 4 for the S&P 500), you should reduce position sizes and be more selective — even Stage 2 stocks can correct sharply when the market falls. EasySwing's market regime indicator helps you calibrate position sizing to the current environment. ## Practical Checklist for a Stage 2 Stock - ✅ Price > 50-day MA > 150-day MA > 200-day MA - ✅ 200-day MA trending upward (slope positive) - ✅ Volume on up-days > volume on down-days (past 60 trading days) - ✅ Stock within 30% of 52-week high (not overextended) - ✅ RS rank ≥ 70 (ideally ≥ 90) - ✅ No Stage 3/4 characteristics (no "rounding over" pattern, no death cross) --- *EasySwing screens for Stage 2 stocks across 2,000+ US equities automatically. Once you've identified Stage 2 stocks, look for [VCP patterns](/blog/vcp-setup-volatility-contraction-pattern) as entry triggers and use [RS rank](/blog/relative-strength-rank-rs-90-swing-trading) to confirm leadership. New to swing trading? Start with [What is Swing Trading?](/blog/what-is-swing-trading-complete-guide). Scan results are for informational purposes only. See our [Risk Disclaimer](/disclaimer).* --- *This is the LLM-optimized version. Human version: https://easyswing.trading/blog/stage-2-stock-analysis-minervini-uptrend*