Gogo, DocuSign, DraftKings Have Bears Licking Their Chops: How Things Could Play Out
Gogo, Inc (NASDAQ:GOGO), DocuSign, Inc (NASDAQ:DOCU) and DraftKings, Inc (NASDAQ:DKNG) have all settled into bearish flag patterns on the daily chart. The bear flag pattern is created with a steep drop lower forming the pole, which is then followed by a consolidation pattern that brings the stock higher between a channel with parallel lines.
- For bullish traders, the "trend is your friend" (until it's not) and the stock may continue to rise upwards within the following channel for a short period of time. Aggressive traders may decide to purchase the stock at the lower trendline and exit the trade at the higher trendline.
- Bearish traders will want to watch for a break down from the lower descending trendline of the flag formation, on high volume, for an entry. When a stock breaks down from a bear flag pattern, the measured move lower is equal to the length of the pole and should be added to the highest price within the flag.
A bear flag is negated when a stock closes a trading day above the upper trendline of the flag pattern or if the flag rises more than 50% up the length of the pole.
The GOGO Chart:
The DOCU Chart:
The DKNG Chart:
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