GoPro (GPRO) has been sliding in investor sentiment for a year. After falling below the 200 DMA over a year ago, GPRO continued to splash around in the dirt. Today it seems to be launching out of a base as we head towards the retail season for youth with Back to School. The SCTR was asleep for the last 9 months and started trending up in July. I like to look at stocks where the SCTR is consistently poor and then starts to wake up. There can be a change in investor sentiment starting to show and this can lead to explosive moves higher. While the change is hard to see on the Relative Strength line in Purple, it is very obvious on the SCTR score that something is changing.
With a nice pattern breakout, we can also see the volume soaring and the MACD above zero for the first time in a long time. Twitter is another chart showing similar chart patterns. These can work out very well and your risk is defined by the breakout line.
Greg Schnell, CMT, MFTA