CEO Multi-Day Buy
$4.5M
Pattern Type
Pennant
Target Leg 2
$28.50
Risk/Reward
2.7:1
Confidence
High
The Technical Setup
From Rising Wedge to Bullish Pennant
Since March 11, NSP has exhibited a Rising Wedge, which is traditionally a bearish exhaustion pattern. However, as the price approached the apex, it failed to break down. Instead, it transitioned into a tight Bullish Pennant consolidation starting today.
This "pattern failure" is a strong signal that the underlying trend is powerful enough to absorb any selling pressure. With the CEO buying $4.5M worth of stock in the last 72 hours, we have a clear fundamental reason for this technical strength.
Entry Triggers
Primary Trigger: $25.75
A clear hourly close above the top rail of the pennant. This confirms the resumption of the primary trend.
Volume Confirmation
Look for Relative Volume (RVOL) > 2.0 on the 1-hour chart at the moment of breakout. "Price follows volume."
Required Indicators
9-EMA (The Speed Line)
The price should be "hugging" the 9-EMA. If it's more than 3% extended, wait for a touch of the EMA before entering.
Bollinger Squeeze
Look for the bands to "tighten" on the 4-hour chart. A breakout from a tight squeeze is much more explosive.
Trade Plan
Entry Zone: $25.75 – $26.00 (Buy on breakout confirmation).
Stop Loss: $24.40 (Set just below the pennant's lower rail and psychological support).
Take Profit: $28.50 (Target based on the measured move of the $3 initial "flagpole").