Price action & Psychology - ABCD Pattern, what's next ?

NASDAQ:VRA   Vera Bradley, Inc
Hello !

Key points :
  • New trend starting after ABCD pattern
  • First pullback occuring on 50% retracement
  • Volume on uptrend is higher than downtrend
  • Consolidation taking place

ABCD Pattern

This isn't a quite regular ABCD pattern, even though the time between AB and CD is almost equal (or near). What I look for when trading this pattern, is either the pattern himself (buying the "D", or the "new low") or what happens after it. In most cases the "D" from the pattern marks the start of a new trend.

Volume & first pullback

You can see that the volume that made the stock go up (from the "D") is way higher than the volume that formed the pullback. Some traders toke profits while others sold for a losing trade because they bought too late (greed).


Recognize a consolidation :

1) Narrow range
2) Low volume
3) Support zone

***Disclaimer : This is not an advice to buy the stock.***

Thanks for reading and if you have suggestions or wanna discuss the idea, just leave a comment, I'll be happy to answer.

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