Thursday, October 8, 2015

GPRO GoPro 2-Hour Chart Falling Wedge Oversold Positive Divergence

The cab driver told Keystone this morning that he is short GoPro. Mabel, the waitress at the diner in the shopping plaza, says she is going short GPRO. Camera maker GoPro has fallen out of favor tumbling from 66 to 27 in only eight weeks time a -59% crash. Perhaps CEO Nick Woodman will post a video on the GoPro site showing his reaction to the tumbling stock price.

Now that everyone hates it maybe a bottom is in? Keystone never played GPRO on the way up it always seemed a bit gimmicky, however, now that GoPro is bludgeoned and in the emergency room, using a selfie-stick to record the event, it may recover. The daily chart is positively diverged and ditto the weekly chart except for one or two indicators; those charts can be posted later. For now, the possie d on the daily indicates that GPRO may be trying to find a base and recover.

GPRO is a highly speculative long play only to be bot if you are willing to lose all your money. Keystone opened a long trade in GPRO a short time ago. Looking at the 2-hour chart, a lower price is met with higher sloping indicators which is positive divergence (green lines) hinting at a bottom and pending bounce. There are a lot of shorts in this stock so a short-covering rally, should it occur, would be a rocket launch higher. The green falling wedge and oversold stochastics are also indicating a bounce in price is near. Price is extended below the moving averages requiring a mean reversion higher.

Keystone's 80/20 rule says 8's lead to 2's and 2's lead to 8's so the drop through 32 hinted that 28 was on the way which occurs so the 27-28 has potential for a bottoming area. Price will need to hold 27.20 otherwise 26.80 will likely be on the table. The RSI and stochastics show a lower low over the last few hours so it may take 2 or 3 candlesticks to create the bottom so say anytime between now and tomorrow morning.

Keystone is long GPRO as of today and  will likely add on further weakness. The trade is very dangerous. Further commentary can be added with the daily and weekly charts. The holiday season is upon us and folks will likely buy a lot of GoPro cameras and selfie-sticks. A -60% drops is a heck of a drubbing off the top and the stock does have value. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

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