Amer Sports (NYSE:AS) is currently in Phase 2 of its 18-phase Adhishthana cycle on the weekly chart. While the stock has been in a sharp rally since August 2024, a closer look through the lens of the Adhishthana Principles raises caution. Here’s what’s flashing red and what lies ahead for the stock.
Amer Sports Weekly Charts: Rally In The Wrong Phase
On the weekly chart, Amer Sports sits in Phase 2 of its Adhishthana cycle. The Adhishthana Principles are our proprietary framework, which blends sophisticated behavioral patterns with quantitative signals to predict market movements.
Phase 2 has two parts: the Sankhya period, typically marked by weakness or consolidation, and the Buddhi period, which brings the real breakout.
Amer Sports, however, has been rallying during its Sankhya period, moving from ~$20 to ~$40 when weakness or sideways trading is the expected behavior. Such misalignment with the principles is rarely rewarded for long. As the stock began transitioning toward the Buddhi period, signs of stress already surfaced, with a ~20% correction from $42 to $32.
(Read our CIENA commentary for a textbook example of a properly aligned Phase 2 rally.)
When a stock rallies in the wrong period of Phase 2, the Adhishthana Principles advise caution. Quoting from my book Adhishthana: The Principles That Govern Wealth, Time & Tragedy:
“Decisions should follow only when alignment with the Principles of Adhishthana is achieved. If Phase 2 is not executed properly, the Yajña, C5, and C6 must be observed before making a decision.”
Investor Outlook for Amer Sports
With a rally arriving in the wrong period, Amer Sports may not sustain this momentum. While several firms remain bullish, we remain skeptical of the current move. Phase 2 on the weekly chart doesn’t conclude until May 2026, and a clearer setup is likely only once the Yajña formation begins.
Options activity adds to the caution, with heavy call writing seen in out-of-the-money strikes, another sign of skepticism in the market. For now, patience may be the best strategy.
