A segment of the market that I love checking out are big, brand name stocks that have taken a beating. You can find some killer bargains in that group of stocks.
Like this falling wedge chart pattern in $GPRO (GoPro).
Here you can see that after making a high in the $90’s, $GPRO has been steadily declining over the last six months. This decline in price has created converging support and resistance downward trendlines that have formed a falling wedge pattern.
And that’s what I like.
If you don’t know anything about GoPro you should know that $GPRO (GoPro) is a huge brand name in the wearable video capture space.
Here’s the profile from Yahoo.
GoPro, Inc. develops hardware and software solutions to alleviate consumer pain points associated with capturing, managing, sharing, and enjoying engaging content.
The company offers HERO line of capture devices, such as cameras; premium accessories, including battery BacPac, smart remote, and LCD touch BacPac accessories; and mounts comprising equipment-based mounts consisting of helmet, handlebar, roll bar, and grip and tripod mounts that enable consumers to capture content while engaged in a range of activities, as well as mounts that enable customers to wear the mount on their bodies, such as wrist housings, chest harnesses, and head straps.
If you like extreme sports at all you will already know about GoPro.
For me I like 3 things here:
- The falling wedge chart pattern
- The brand name
- The huge sell off over the last 6 months
So how do you trade this falling wedge chart pattern? Simple. You wait for a break of the downward sloping resistance line.
On the $GPRO chart it would be here:
For more information on the falling wedge pattern, be sure to check out the links below:
- Bulkowski’s Falling Wedge Pattern on ThePatternSite.com
- Falling Wedge Pattern on StockCharts.Com
- Official GoPro Website