On December 15 we continued to recommend a cautious stance on QuantumScape (QS) only to see it soar still higher and reach the $132 area. I must admit that a lot of money was left on the table.
As long as you do not think of Peter and the Wolf, today we might be seeing a top reversal in the making.
In this updated daily Japanese candlestick chart of QS, below, we can see a possible bearish hanging man pattern today. If you are not conversant in candles then consider that we are watching a large inside day pattern. A close below Tuesday's low will be a short-term sell signal - a close below the low of the high day.
The On-Balance-Volume (OBV) line is showing a downtick at this point in time and the slow stochastic indicator is crossing to the downside from an extremely overbought level. A new record high would refresh the chart however.
In this intraday chart of QS, below, we are looking at just the past 10 days of price action. A decline below $105 and then $100 is likely to precipitate further declines.
Bottom line strategy: I am not a perma bear but when I see something bearish I point it out as opposed to ignoring it.
