On November 15, our momentum scanner flagged DeFi Technologies (DEFI.NE) (DEFTF) as a potential breakout candidate. The stock was setting up on the right side of a significant multi-month base, showing signs of increasing volume—an early indicator that momentum was beginning to build.
The Setup: A Textbook Volume Profile
The chart was a technical analyst’s dream. Early in the base, we observed a surge in volume during the initial ramp. Over the subsequent five months, as price action consolidated, volume began to contract—a classic setup. This contraction often signals that sellers are exhausting themselves, paving the way for the next leg up.
As price action approached the breakout zone, volume began to pick up again, confirming our thesis. In technical analysis, there’s an old saying: “The bigger the base, the higher the space.” With this setup, we informed our readers that a breakout was likely on deck.
The Follow-Through: Breakout and Retest
Following our initial signal, price action did break out as anticipated but subsequently pulled back to retest the breakout line. On November 27, we highlighted this retest to our readers, noting the importance of monitoring the breakout line. A successful retest often sets the stage for a continuation of the trend, and this scenario was no different.
The Next Leg: Momentum Builds
By December 3, price action had completed the retest and surged higher, forming a bullish flag pattern—another textbook continuation signal. As momentum accelerated, the stock climbed to a new 52-week high by Friday’s close.
This kind of price action, combined with strong momentum in the broader crypto market, positioned DeFi Technologies as an asymmetric opportunity compared to other charts we monitored. The financial metrics further reinforced our view that the stock was undervalued, especially relative to its peers.
What’s Next?
As we watch DeFi Technologies hit a 52-week high, it’s worth noting that the stock has a history of parabolic moves. While we remain bullish, we’re also prepared to monitor for consolidation or continuation patterns in case of a pullback.
With momentum in the crypto market still strong, we’ll keep this name on our radar for further updates. For now, DeFi Technologies exemplifies how technical analysis combined with disciplined monitoring can lead to incredible opportunities.
As DeFi Technologies continues to hit new highs, it’s clear how valuable timely, data-driven research can be. Spotting these moves early helps you stay prepared and make informed, independent decisions.
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