GPRO is certainly not one of Wall Street’s darlings -despite stellar smashing earnings- and everybody is selling their shares as if they carry an infectious disease. Hence, when nobody wants them, maybe it’s time to buy it!? Or as my favorite investor once said: “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”. Is it that time? Let’s have the price chart do the talking!
What we see are
- 5 none-overlapping waves up from the first day of trading to the $98.47 high (A/I): impulse
- many overlapping was down from the ATH to the current low (B/II?): corrective
- The larger corrective waves consist of 3-waves (yellow a, and yellow b)
- Yellow wave b was a perfect 62% retrace of yellow wave a
- The ensuing yellow wave c is also overlapping and currently at around the 138.2% extension of wave a, measured from b
- A falling wedge is forming. Falling wedges are bullish formations as often price -at least- returns to the beginning of the formation, which in this case is the end of the yellow b-wave: $86ish. From current levels that’s a double bagger. But, actually there are two possible wedges forming:
- The first wedge (the lower of the two upper yellow trendlines) is already complete
- The 2nd possible wedge (the upper of the upper yellow trendlines) is still forming and either targeting the 161.8% extension of major a (at $32), or it is very close to completing (a trade and close above the upper yellow line means the pattern has completed).
All ingredients are present for a bullish falling wedge formation. But, since nothing is certain in live, and especially not in the stock market, please be mindful of a breakdown below the lower yellow trendline. It will mean an invalidation of the wedge formation. Until then the wedge formation is very much on the table.