Accumulation and Distribution

Accumulation and distribution are concepts used to describe the flow of money into and out of a stock or asset. Accumulation occurs when investors are buying more shares, signaling confidence and potential upward movement. Distribution happens when investors start selling, which can indicate a lack of confidence and potential decline. These phases reflect the supply and demand dynamics: accumulation suggests increased demand, while distribution suggests increased supply. Understanding these movements helps investors gauge whether a stock is likely to go up or down soon, based on whether money is flowing in or out of the asset.