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PTON: How Markets Really Work

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PTON had a Christmas gift for the bulls, but it didn’t come with batteries.

It tested its December 24, 2020 peak at 171 on January 14, leaving a Lizard sell signal… a 10 day high Topping Tail where the open and close are near session lows following a runup and reversal.

From 171, PTON declined 2 revs of 360 degrees, or 2 full cycles, to the 81 region on May 6, 2021.

171, orange
81 green
May 6 is straight across and opposite 81.

May 6, red
81, green

This is why we told Hit & Run subscribers that there was a strong likelihood that PTON was bottoming on May 6.

Volume exploded on the May 6 large range decliner, also suggesting a washout coincident with a news headline regarding issues with their treadmill.

360 degrees up from the 81 May low is 121.

Often stocks overthrow/undercut tops and bottoms in a 90 degree spike.

90 degrees up from is 132/133.

132/133 is square May 6 for a possible time/price square-out.
132, red
May 6, green
81 blue

As well, this 127 region represents a 50% retrace of the range from high to low.

In sum, PTON is testing its July 7 reversal at this 130 region.

Its behavior — whether a test failure plays out or whether it can eclipse this zone — will give us a lot of information as to what kind of shape PTON is in.

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