GrowLife Inc (PHOT)

[Archeogeek]

Analysis of historical PHOT money movement vs recent action is quite interesting at present. I'd like to point out some information that suggests that the last week or so of trading may represent an exceptional situation.

I'm going to be using past and present accumulation and distribution index patterns (ADI), sometimes called Money Flow (MF) and Volume Weighted Average Price (VWAP) measures.
For those who did not see my previous posts discussing these, you can find the definitions, charts, and a discussion of why I think they are important in posts 72188, 72235, and 72681. You may want to look at these first.

I'd like to discuss the action today, 3/27, first. Take a look at the daily chart here: http://investorshub.advfn.com/uimage/uploads/2014/3/27/kblhy3-27-2014_4-27-52_PM.jpg and attend to the yellow (VWAP) and blue (MF) lines in the second panel up from the bottom.

As you can see, from 9:30 to 11:00 The VWAP simply falls with the price - normal action. The MF falling with it is distribution from the weak hands being shaken out. At 11:00, after this action, the MM takes control of the VWAP for reasons previously discussed, and it flat-lines at his agreed VWAP delivery price for the rest of the day. At the same time, the MF steadily climbs for the rest of the day as the MM delivers accumulation to the strong hands at a steady pace. As you can see, this is accomplished without any obvious relation to simple price and volume because that's what the MM is manipulating. By the end of the day all of the shares shaken out at the beginning have been moved to stronger hands at a lower average price.

This sort of action has been going on daily for the last week or so. However, that is not a usual daily occurrence. Please refer to the long-term chart at http://investorshub.advfn.com/uimage/uploads/2014/3/27/epkqn3-27-2014_4-29-10_PM.jpg which shows PHOT since mid-November.

Again, please look at the MF and VWAP lines. They pretty much run together as you would expect except for a first period beginning just before and during the big run up from 12/10/2013 to 1/9/2014 and the present period beginning 3/19/2014. Note that it is not simply a case of advancing or declining price periods; there is no such separation during the fall from 1/09 to 1/21 although there is one now. For reasons discussed in my previous post, I believe these represent periods in which big money knows more than we do about what's coming next and desires to accumulate strongly without moving the market to their disadvantage by doing so. I am not thinking of this as a technical indicator; rather I think of it as an indication that there are fundamental factors about to be in play that are not yet in the general public knowledge.

I have not run a statistical analysis, but by eyeball these two periods look significantly out of the ordinary for the normal variance, and qualitatively different from other periods by these measures. This suggests to me that something out of the ordinary is impending.