From Energy to Growth: The 3-Signal Framework Gary Glover Uses to Identify the Next ASX Market Leaders
- Christopher Hall
- 3 days ago
- 13 min read
Written by Christopher Hall, AdvDipFP | Authorised Representative, AFSL 526688 | March 2026
When ASX energy stocks reach key resistance levels after a sustained rally, professional traders do not simply take profits and wait. They rotate — quietly, systematically, and early — into the next group of overlooked stocks already showing accumulation signals. Gary Glover's 3-signal framework identifies this rotation before the broader market notices it: price action tightening into a narrow band, trading volume running at 2–3 times the average, and a series of higher lows forming as the broader market makes lower highs. In March 2026, all three signals are appearing simultaneously across a specific group of ASX growth stocks.
Why the Stocks Nobody Is Talking About Are Often the Ones Worth Watching Most
There is a reliable pattern in how professional traders and retail investors behave differently at market turning points. Retail investors focus on what is moving right now — the sector generating headlines, the stocks already running hard. Professional traders focus on what is quietly building underneath the surface while everyone else is distracted.
In March 2026, the distraction is energy. Santos (STO.ASX) and Karoon Energy (KAR.ASX) have delivered outstanding returns since Gary Glover identified energy as the next ASX market-leading thematic in December 2025. The Middle East conflict has amplified those gains further, pushing oil and gas names into key resistance levels with elevated volatility and intense media coverage.
And that is precisely when Gary's attention has shifted.
"Large pockets of the market are pretty expensive," Gary observed in his 9 March 2026 analysis. "The only area I can see a bit of value in there is actually growth — which is kind of strange. You normally don't see growth get hit as hard unless you're at a really deep inflationary period."
The stocks now on Gary's radar — CAR Group (CAR.ASX), Catapult Sports (CAT.ASX), SEEK Limited (SEK.ASX), Pro Medicus (PME.ASX), and Guzman Y Gomez (GYG.ASX) — are not generating headlines. Nobody is talking about them. And according to Gary's framework, that is often the first signal worth paying attention to. As the transcript notes, many of these names have pulled back precisely to the point where their accelerating trend lines first began — the technical magnet Gary identified months earlier. Understanding how accelerating trend line breaks signal the correction endpoint helps explain why these levels are now attracting accumulation.
For momentum traders studying how to identify leading sectors for VCP pattern trading, this rotation dynamic is one of the most consistent and exploitable patterns in Australian equities.
The Historical Context: Why Rapid Rotations Are Normal
Before examining the specific signals Gary is watching, it is worth understanding why this rotation is happening so fast — and why it is not unusual when viewed through the lens of market history.
Gary Glover is a student of market history, particularly the high inflation periods of the 1940s and 1970s. His observation in the 9 March session was direct: "It's not an extraordinary market — but it's identical to what happened in the 40s and 70s. You go back and study the 40s and the 70s markets, which were high inflation, because we had the same type of breathtaking moves taking place in those markets."
The key insight from those historical periods is that sector rotation — money flowing rapidly from one group into another — runs faster and with less warning than in low-inflation, low-volatility environments. In the 1940s and 1970s, traders who waited for confirmation that a sector had turned were perpetually late. The early accumulation signals were the entry. By the time the rotation was obvious, the move had largely already happened.
"These normal sort of swings — they normally take a lot longer to roll through. They're rolling through a lot faster," Gary noted, pointing to blue-chip stocks like Telstra, CBA, and Woolworths moving 10–15% in a matter of days during the February 2026 earnings season as evidence of this accelerating transmission speed.
For traders applying Mark Minervini's SEPA methodology to ASX markets, this accelerating rotation cycle means the window between early accumulation signals and a full breakout is compressing. Identifying the signals early is not just an edge — it is increasingly a requirement. The mechanics of how vertical trends develop and then hand off to the next sector are explored in detail in Understanding Vertical Trends and Sector Rotation: Advanced Trading Lessons from ASX Growth Stocks.
The 3-Signal Framework: How Gary Identifies Accumulation Before the Move
Gary Glover's framework for identifying the next sector leader before it becomes obvious uses three specific, observable signals that appear in sequence. All three must be present simultaneously for a stock to qualify as a genuine rotation candidate.
Signal 1: Price Action Tightening Into a Narrow Band
After a significant decline, accumulation stocks stop making new lows and begin to trade within an increasingly tight price range. Gary describes this as the stock "basing" — the price action compresses as sellers are absorbed and buyers gradually establish positions at consistent levels.
"You're seeing the price action sort of tighten up as well. After having a fairly large decline, they sort of start to base and start to build a couple of higher lows, and then they often times end up in a really tight shelf — and then you're looking for them to maybe break out of that shelf."
This tightening is the first signal because it indicates the selling pressure that drove the stock lower is exhausting. The range contraction itself is a measurable, objective observation — not an opinion. For traders familiar with VCP patterns on ASX stocks, this price tightening is the foundational characteristic of the volatility contraction pattern itself.
Signal 2: Volume Running at 2–3 Times the Average
Price tightening alone is insufficient. Gary requires elevated volume to confirm that institutional accumulation — not just a lack of sellers — is driving the range compression.
"The other thing you're seeing, which is across a lot of those names, is you're seeing the trading volumes sitting at two or three times the average volume. When you see a big decline and you start to see the volume starting to wind up in a pretty large manner — that does show possible accumulation."
The critical distinction Gary makes is where in the trend this elevated volume appears. "It does matter where that comes in. If it's had a pretty good run and it's up pretty high, and you see big volume coming out — that's probably distribution. But if you've had a pretty large decline and then it starts to flatline and base, then you start seeing volume — the buyers are finally coming in here and starting to accumulate at those levels."
Volume at the bottom of a decline with tightening price action is the fingerprint of institutional buying. This is precisely what understanding the line of least resistance in VCP patterns describes — the path of least resistance shifts from down to sideways to up as accumulation completes.
Signal 3: Higher Lows Forming as the Market Makes Lower Highs
The third and most powerful signal is relative strength — specifically, the stock making higher lows at the same time the broader market is making lower highs. This divergence is the clearest indication that institutional money is actively defending and accumulating the stock against the broader market tide.
"How are these making higher lows as the market is making lower highs? That's the relative strength that comes into play."
This form of relative strength is distinct from the more commonly discussed version where a stock holds near 52-week highs while the market falls. Here, the stock has already experienced a significant correction — but is now recovering in a higher-low pattern even as the market continues to weaken. It is quieter, less obvious, and frequently more reliable as a signal of genuine institutional accumulation.
When all three signals align — tightening price, elevated volume, and higher lows in a weak market — Gary begins watching for the breakout trigger.
Applying the Framework: Five ASX Stocks Showing Accumulation Signals in March 2026
CAR Group (CAR.ASX) — Price Tightening After Large Bounce
CAR Group experienced aggressive selling pressure in the technology and software sector sell-off driven by AI concerns through late 2025 and early 2026. The February 2026 earnings announcement was well received by the market, producing a large initial bounce — but crucially, only a small retracement followed.
Gary's observation: "Technically we saw a large bounce and only a small retracement so far, and price action has tightened up again with increased trading volumes hinting at signs of accumulation taking place."
The small retracement following a strong earnings bounce, combined with volume picking up as price compresses, is Signal 1 and Signal 2 in sequence. Gary holds a 4% position and is watching for a low-risk entry to add.
Catapult Sports (CAT.ASX) — 61.8% Retracement and Sideways Strength
Catapult Sports provides one of the clearest examples of Signal 3 — relative strength — in the current market. While most ASX growth names were finding successive new lows through early 2026, Catapult went sideways for three to four weeks, refusing to follow the market lower.
"While most of those names were actually going deeper, finding a deep low, it actually sort of went sideways for about three or four weeks while everything else was finding new lows. So it actually did show a little bit of strength there versus the sector."
The stock also pulled back to the 61.8% Fibonacci retracement of its major weekly range — a technically significant level that frequently acts as support for high-quality momentum stocks during corrections. Gary added a 4% position and is watching for follow-through.
Catapult also benefits from what Gary identifies as a strong competitive moat — long-term contracts with sporting bodies across the NBA, rugby, and soccer that lock in revenue streams for two to five years and are not subject to sudden cancellation.
For traders studying how episodic pivot trading works, Catapult's tight consolidation following a strong earnings bounce is a textbook post-catalyst base-building setup.
SEEK Limited (SEK.ASX) — Ending Diagonal Pattern and $4M Director Buying
SEEK Limited has experienced a deep correction — Gary's characterisation is that "it's come back more than just a healthy correction, it's come back very deep." But it is the combination of technical and fundamental signals that makes SEEK particularly compelling.
On the technical side, the daily chart is showing an ending diagonal pattern — a structure Gary notes often appears at the conclusion of a sustained downtrend, signalling exhaustion of selling pressure. Volume has been running at two to three times the average over recent weeks.
The fundamental confirmation is stark: seven company directors purchased approximately $4 million of SEEK shares on the open market between $16 and $40 — deploying their own capital at current price levels. Director buying of this scale, concentrated across multiple insiders simultaneously, is a signal that those with the deepest knowledge of the business see genuine value at these levels.
"When you see the company directors — seven directors tip in four million bucks across their own money between $16 and $40 — that should be telling you something."
Director buying does not guarantee a stock will move immediately. But combined with tightening price action and elevated volume, it provides the fundamental conviction layer that supports the technical accumulation signals.
Pro Medicus (PME.ASX) — Heavy Accumulation Volume in a Tight Band
Pro Medicus has been one of the most discussed casualties of the AI-driven technology sell-off, declining sharply from its highs since October 2025. But Gary's current assessment focuses not on the decline — but on what is happening at the lows.
"The past fortnight has seen some interesting and tight price action occurring on heavy trading volumes. We're seeing the last few weeks there price sort of start to normalise and congest. We are starting to see the market stay in that little tight rectangle."
Volume running at two to three times the average while price action tightens into a rectangle at the lows is the clearest textbook accumulation signature in Gary's framework. Two directors — including the CEO — have purchased stock on the open market at current levels, with the CEO deploying approximately $1 million and a second director contributing approximately $400,000.
Gary holds a 3% position and is watching for a breakout of the tight price band as the entry trigger.
The broader AI thesis Gary applies to PME mirrors the ResMed situation of 2023–2024, when GLP-1 weight loss drugs were expected to devastate ResMed's sleep apnoea device business. The market aggressively sold ResMed — and then was proven wrong as the drugs ultimately drove more diagnosis and more device usage. Gary's view is that established SaaS market leaders like Pro Medicus will be the primary beneficiaries of AI adoption in their industries, not the casualties.
"The biggest companies are going to be the ones who actually use AI the most. The normal market leader is who we use the most — that's who AI is going to just keep building on."
Guzman Y Gomez (GYG.ASX) — Too Early, But First Signs of Life
Guzman Y Gomez represents a different category in Gary's framework — the early warning stock. Not yet showing full accumulation confirmation, but displaying the first observable signs that the trend may be changing.
GYG broke out of a descending channel in the final week of February 2026, with the broader market weakening around it. The stock held up better than most names in a falling market — the simplest and most reliable form of relative strength. Volume at the low was present, though follow-through has not yet materialised.
Gary's historical framework for understanding GYG is instructive: fast food chains that achieve national scale and then expand into international markets have produced some of the largest momentum moves in market history. Domino's Pizza is the ASX parallel. "Once they're on a roll, they can move. I think it's just worth keeping an eye on the stock." This lifecycle pattern — hot IPO, post-listing fade, reacceleration as fundamentals mature — is the same dynamic explored in The IPO Lifecycle Trade: How Eve Boboch and Kathy Donnelly Identified a 1,000% Pattern Before the Move.
The lesson here is broader than GYG specifically: early warning stocks — those showing their first signs of life while still technically early — belong on a watchlist, not a buy list. The discipline is patience. Watching without acting until the accumulation signals are fully confirmed is as important a skill as identifying the signals in the first place.
How to Manage the Energy Position While Rotating Into Growth
The rotation from energy to growth is not a binary switch. Gary's approach to managing Santos (STO.ASX) and Karoon Energy (KAR.ASX) as he begins building growth exposure is instructive for understanding how professional position management works across a portfolio. For the full framework on how professionals handle energy stocks during and after a geopolitical spike, see How Professional Traders React to Oil Price Shocks: The 3-Phase ASX Playbook.
For Santos, Gary's view is clear: $8.00 has been strong resistance for three years and represents the level to begin reducing exposure. The preferred mechanism is not selling outright, but writing covered calls at or near the $8.00 level — capturing the elevated implied volatility generated by the conflict-driven price spike, while maintaining exposure to the longer-term upside if Santos consolidates and breaks higher in subsequent months.
"The smart play in my opinion would be to take some profits near $8, or write a call option here, and ideally we get a consolidation period under $8 in the short to medium term before breaking above $8 at a later period — maybe a few weeks to months away in time."
For Karoon Energy, Gary is scaling out of a 9% position in three tranches — 3% at $1.99, 3% at $2.07, and 3% at $2.17 — staggering the exit across the resistance band rather than attempting to time the exact top. The underlying base structure with four higher lows remains intact and constructive longer term.
For traders applying VCP trade execution principles, this staged exit methodology mirrors the same discipline applied to entries — never committing or exiting a full position at a single price point.
Frequently Asked Questions
What are the 3 accumulation signals Gary Glover looks for in ASX growth stocks? Gary Glover's 3-signal accumulation framework requires: price action tightening into a narrow band after a significant decline; trading volume running at 2–3 times the average during the tightening period; and the stock making a series of higher lows while the broader market makes lower highs. All three signals should appear simultaneously for a stock to qualify as a genuine rotation candidate.
How is Gary Glover rotating from energy stocks to growth stocks in March 2026? Gary is reducing energy exposure in Santos (STO.ASX) by writing covered calls near the $8.00 resistance level, and trimming Karoon Energy (KAR.ASX) in three staged tranches at $1.99, $2.07, and $2.17. Simultaneously, he is building initial positions in growth names including CAR Group (CAR.ASX), Catapult Sports (CAT.ASX), SEEK Limited (SEK.ASX), and Pro Medicus (PME.ASX) that are showing accumulation signals.
Why does director buying matter as a signal for ASX growth stocks? Company directors have access to internal information about their business that external investors do not. When multiple directors purchase stock on the open market simultaneously — as occurred with seven SEEK directors buying $4M between $16 and $40, and two Pro Medicus directors purchasing approximately $1.4M combined — it signals that those with the deepest knowledge of the business believe the current price represents genuine long-term value.
What does an ending diagonal pattern indicate on an ASX chart? An ending diagonal is a price structure that frequently appears at the conclusion of a sustained downtrend, characterised by overlapping waves with converging trend lines. It signals exhaustion of the prevailing trend — in this case, the selling pressure in SEEK. Gary Glover identified an ending diagonal forming on SEEK's daily chart in March 2026, in combination with elevated volume, as an early signal that the downtrend may be approaching completion.
Why did Gary Glover compare the current market to the 1940s and 1970s? Both the 1940s and 1970s were periods of elevated inflation and rapid sector rotation, characterised by breathtaking price moves that resolved much faster than investors expected. Gary's study of these periods informs his current framework: in high-inflation, high-volatility environments, sector rotations are faster, accumulation windows are shorter, and waiting for confirmation of a trend change means missing the early entry that produces the best returns.
What is the difference between distribution volume and accumulation volume on ASX stocks? Distribution volume occurs when elevated trading activity appears after a sustained price rise, near highs — indicating institutional selling into retail buying. Accumulation volume occurs when elevated trading activity appears after a sustained decline, near lows, while price action simultaneously tightens — indicating institutional buying absorbing retail selling. The location of elevated volume in the price cycle determines its significance.
How does GYG fit into Gary Glover's ASX growth stock framework? Guzman Y Gomez (GYG.ASX) is classified by Gary as an early warning stock — one showing its first observable signs of a trend change but not yet displaying full accumulation confirmation. It belongs on a watchlist rather than a buy list. Gary's historical framework for GYG draws on the pattern of fast food chains — including Domino's Pizza on the ASX — that undergo rapid national rollout followed by a post-IPO cooling period, before reaccelerating as the store network matures and unit economics improve.
Educational Disclaimer: This content is for educational purposes only and does not constitute financial advice. Past performance is no guarantee of future results. Consider your financial situation and seek professional advice before making investment decisions.
Finer Market Points Pty Ltd, CAR 1304002, AFSL 526688, ABN 87 645 284 680. This general information is educational only and not financial advice, recommendation, forecast or solicitation. Consider your objectives, financial situation and needs before acting. Seek appropriate professional advice. We accept no liability for any loss or damages arising from use.
Gary Glover (AR 259215) is an Authorised Representative of Novus Capital Limited (AFSL 238 168). Level 24, 56 Pitt Street, Sydney NSW 2000. This article is based on analysis and commentary provided by Gary Glover (AR 259215), Authorised Representative of Novus Capital Limited (AFSL 238 168), during a recorded market analysis session on 10 March 2026. Content has been edited and summarised by Finer Market Points for educational purposes. Gary Glover has not independently reviewed or endorsed this publication
Comments