Edit: Spotted PRTS when it broke out from a VCP break out 3 days ago.
This set up is an absolute beauty. I would rate this as a near perfect set up
- Note the contraction in tightness from left to right.
- Shakeouts within the base. 14 Jan and 24 March, shakeout within the low of the base and strong close.This weeds out weak investors and is also a good sign of accumulation.
- Volume Expansion at breakout
PRTS is now up 20% from the line of least resistance in about 3 days.
PSDV had a breakout reversal. A tennis ball reaction back up would be good.
Revision:
Volatility Contraction Pattern or VCP is a term that Mark Minervini referred in his book as a constructive setup that stocks make before starting to rally, Basically a common characteristic of virtually all constuctive price structures is a contraction of volatility accompanied by specific areas in the base structure where volume contracts significantly. VCP is a signal that the stock is under accumulation. This happens because institutions start to accumulate shares in tight levels and the amount of supply coming to the market starts to reduce or calm down. It carves up a pivot point and the line of least resistance popularized by Jesse Livermore, when price moves past the pivot, it can move pretty quickly as supply is low.
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