QRVO Stock: A Very Large Technical Price Pattern Is Approaching Completion
At this exact moment, I am dismissing the implications suggested by the trade war currently being waged because I believe, and have reason to believe, that the indices are still poised for further gains.
You do not need to look far see why I am still bullish. The markets continue to reach for higher values and stocks continue to forge new highs.
I am focusing on Qorvo Inc (NASDAQ:QRVO) stock because there is a very large technical price pattern currently in development on the Qorvo stock chart. This pattern is approaching completion, and once it is completed, I believe that much higher QRVO stock prices will follow.
This technical price pattern is highlighted on the following Qorvo stock chart.
Chart courtesy of StockCharts.com
This QRVO stock chart highlights a very large cup-and-handle price pattern that has been in development since May 2015.
This pattern was created because a significant level of price resistance that currently resides at $87.00 has prevented the stock price from advancing beyond it.
This inability to advance beyond this level of price resistance has created two distinct troughs. In a cup-and-handle pattern, the first tough is always much larger than the second, and it these troughs that characterize this pattern.
QRVO stock is currently testing price resistance, and in order to suggest that higher prices are likely to follow, it needs to break above it. This event would complete the pattern, finally freeing Qorvo stock and giving it the ability to appreciate.
The great thing about a cup-and-handle pattern is that once resistance is finally broken, it will not only imply that higher prices are likely to follow, but it will also provide a much-needed price objective.
This price objective is obtained by taking the depth of the cup and extrapolating that value above the level of resistance that created the pattern. Applying this logic to the cup-and-handle pattern currently in development suggests that once resistance is broken, $135.00 becomes a viable a price objective.
The good news is that I have reason to believe that this pattern is going to be completed in the not-too-distant future. The price action over the last two months is currently suggesting that such an outcome is extremely likely.
This price action is highlighted on the following Qorvo stock chart.
Chart courtesy of StockCharts.com
This QRVO stock chart has been annotated in order to highlight a wave structure that is currently suggesting that higher Qorvo stock prices are on the horizon.
This wave structure consists of impulse waves and consolidation waves.
The waves highlighted in green are impulse waves. They define the stage in a bullish trend when a stock sustains a move toward higher prices. The advancing nature of this wave captures the gains created within a bullish trend.
The wave highlighted in purple is a consolidation wave. Consolidation waves define the stage in a bullish trend when a stock corrects and refrains from advancing. The corrective nature of this wave is necessary because it creates the conditions so that another wave can follow.
On June 14, 2018, the consolidation wave was completed via a breakout. This event implies that an advancing impulse wave is currently in development.
This notion of higher QRVO stock prices, via an impulse wave, is being supported by the moving average convergence/divergence (MACD) indicator.
MACD is a trend-following momentum indicator that determines whether bullish or bearish momentum is influencing the price action in a stock. Bullish momentum implies that a stock is geared toward higher prices, while bearish momentum implies that a stock is geared toward lower prices.
This indicator is very influential because a stock cannot sustain a move in either direction unless the applicable level of momentum is supporting it. This is why this indicator has the propensity to confirm which wave is in development.
On May 1, 2018, a bullish MACD cross correctly confirmed that an impulse wave was in development. On May 29, 2018, a bearish MACD cross correctly confirmed that consolidation wave was in development.
The completion of the consolidation wave has coincided with a bullish MACD cross. This reinforces the notion that higher prices via an impulse wave are now in development.
This price action strongly suggests that resistance at $87.00 is likely to fall in the not-too-distant future, which will complete the cup-and-handle price pattern.
A very large technical price pattern is approaching completion on the Qorvo stock chart. Once this event occurs, I believe that much higher QRVO stock prices will follow.