Just wanted to draw your attention to some interesting price action because it looks constructive and could be setting up for a bigger move.
$POLA, nano Float, haven’t found any news. Today it basically started acting like it was making a range rotation and setting up for a possible follow-on breakout. **This ticker has a habit of bouncing hard from the $1.70 area.** It typically teases a major breakout. It hasn’t followed through on “the mega move” yet, but it still is usually good for as far as \~$2.20, so I always watch this one when it hits $1.70.
On the attached Daily, you can see how it’s spent months building acceptance between roughly $1.60 and $2.20. If you look at the volume profile, you can see the lower edge of the broader value area at around $1.61, and the control point is right there at $2.19/$2.20.
**This is basically why the $1.70 bounce keeps working.** Price hits the bottom of what the VProfile shows as the bottom of accepted value so selling dries up. Range traders begin picking it up there for another rotation. The sub-3M float means it can move with only moderate volume, and other traders, like me, have seen the pattern fulfil enough times that the pattern actually becomes self-reinforcing. IMO it’s great to have tickers like this in your roster because they’re reliable plays. Note: all plays are reliable plays **until they’re not,** so manage risk and never get overconfident with a penny!
So breakout traders like myself are going to evaluate the strength of a given move for breakout potential anytime we jump back into the range on one of these. And I can say with full confidence that this move **could** be the mega 100% plus move **maybe possibly**… This one refuses to follow chart protocols and do what it’s supposed to and it’s proven me wrong enough times that I’m not going to lean one way of the other. I’ll just say high $2-teens follows pattern and offers a great profit and beyond that, who knows?
Doing my best to refrain from using the “B” word, here’s what I see happening on the charts.
RN sitting inside a dense MA cluster. MA’s are compressing between $1.80-$1.88, which historically means it’s ramping up for a spike over $2, but theoretically it could also surprise us and go south. **This is still a great place to add IMO** because it’s an exceptional price for the pattern-move and if it breaks pattern, it’s not that far off from invalidation/bottom anyway.
What I expect to see is volume expansion across multiple candles from here. Moderate momentum here will turn $2.00 from resistance to support. That will trigger a rush and when it breaks $2.05 it can churn its way to $2.20 very quickly. Keep in mind, if it doesn’t break, these forays to $2.20 can come and go pretty quickly. So, like most pennies, **don’t set it and forget it.**
I did a refresh on the fundamentals and news to see if they’re operating from an environment that could support a breakout and they have had some good things happening. They’ve made a lot of improvements in operating leverage. **Gross margin rose to 65.7%, or approximately 39.7%** excluding the one-time warranty-reserve benefit. **Operating expenses fell 22%** and the net loss narrowed from approximately $1.27 million to $178,000.
Additionally, this is a ticker that will move on new partnership agreements and contracts, and if such an announcement coincides with bubbling price action like we’ve seen today, it could very well fuel a larger move.
Hope everyone has a good week.