Chart Art Parabolic Bullish Arc in DSKX

Jun 18, 2015: 11:45 AM CST

You certainly don’t see patterns like this every day!

Lesser-known stock DS Health Care (DSKX) just jumped to the top of one of my stock scan lists and I wanted to highlight the sweeping “Parabolic Arc” which is one of my favorite broader price patterns.

Here’s the “Pure Arc” – we’ll delve into specifics on the second chart:

For more background on the “Parabolic Arc” Pattern, see the reference post list at the bottom of this post.

An “Arc Trendline” or “Parabolic Arc” pattern is fascinating in that it highlights an exponential price growth in a stock which allows traders to reap instant profits at the heightened risk of a reversal (which is also tradable when price breaks through the vertical trendline).

This low-priced stock formed an arc down from $2.50 in 2014 to reverse up with an “arc reversal” into early 2015.

From there, buyers catapulted the stock higher in an ever-steepening arc pattern that takes us straight up toward the current $5.00 level.

Bulls enjoy the pattern because they can play retracement or breakout trades aggressively into the rapidly moving uptrend.

However, don’t assume price will continue moving vertical forever – that’s where bears come in.

Bears also like this pattern because once price breaks through the rising vertical (lower) trendline, a steep reversal often occurs where price falls rapidly after such a parabolic rise.

Either way, the pattern captures our attention.

Here’s a more traditional chart which highlights the recent “bull flag” opportunities to join the parabolic arc:

Bullish volume and momentum began to spike in March ahead of the April breakout.

Note also the strong pick-up (new highs) in both volume AND momentum as price broke above the $1.00 barrier.

This was an “early accumulation” or early bullish reversal signal that proved to be successful.

From there, into May and now June, price retraced gently to the rising 20 day EMA, both times setting up a low-risk entry into a newly uptrending stock.

In June, price finally turned parabolic as price catapulted – and doubled – from the $2.00 per share level straight up toward $4.00.

A tiny retracement was the most recent – and perhaps final – opportunity to join into this stock on a low-risk retracement entry.

From here, momentum and the parabolic arc have taken over as volume has declined since the the earlier June surge.

Follow what happens next and use this stock as a great reference for this fascinating price pattern.

Also, browse previous posts as references for the “Arc Trendline” and “Parabolic Arc” Pattern:

“Are You Following this Parabolic Arc Pattern in INTC?”

“Interesting Arc Pattern forming in Harley Davidson (HOG)”

“Charting the Long-Term Parabolic Arc Trendline in the S&P 500 since 2009?

“Strength in WYNN and the Parabolic Price Arc

“March Crude Oil Structure and One of My Favorite (Arc) Patterns”

“March Check-up on (Intraday Arc Trendline) Internals at the Highs”

Arc Trendline on the Weekly US Dollar Index (still in motion)”

Key Inflection (and Arc Trendline Lesson) in Apple AAPL” (great lesson)

The Dominant “Arc” Trendlines to Watch this Week in Gold

Intraday Rounded Arc Playing out (SP500)

Lesson in Trading Intraday Arc Trendline Breaks/Reversals

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Corey Rosenbloom, CMT
Afraid to Trade.com

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1 Comment

One Response to “Chart Art Parabolic Bullish Arc in DSKX”

  1. Ronak Says:

    Just wow to this, it’s incredible to see such chart, I believe that if we are able to find right opportunities in nick of time then there is millions to be made here easily. I am doing Forex trading with OctaFX broker and they are a brilliant company with cTrader platform available, so using this I can analysis so much better and also see advance charts system which makes trading so much easier for me in any kind of market situation.