COO Breakout Enters the Gap-Fill Lane: Buy the Dip for a Push Toward 72

Executive summary

• Bias (next 24h): Moderately bullish continuation with buy-the-dip preferred. Expect initial consolidation/dip toward 69.4–70.2, then an attempt to push into 71.3–72.1.
• Rationale: Fresh breakout above a multi-week base and key post-gap resistance (≈69.7–70.0), rising short-term momentum, improving breadth/volume posture, and an unfriendly overhead supply zone that likely begins closer to 72–74 (gap-fill magnet at 74.11). Near-term overbought signals (RSI/Stoch) argue for an early pullback before continuation.

Market structure and trend

• Regime: After the 8/28 earnings gap-down (74.11 → 62–66 zone), COO built a September base between ~64–69 with multiple higher lows after 9/17 (64.32). The 10/1 surge and 10/2–10/3 follow-through reclaimed the top of that base and pushed into the lower bound of the pre-gap supply area. Structure has shifted from distribution to early accumulation/markup.
• Higher timeframe levels: Pre-gap close 74.11 is the principal overhead magnet (gap-fill). Below, the September value area was 66–69; price is now above that shelf, which can act as support.

Price/volume dynamics and the gap

• 8/28 gap was accompanied by capitulation volume (≈14.9M), establishing a long-term reference. Since then, September’s consolidation built a thick volume shelf around 66–68.5. The 10/1 breakout through ~68.6–69 on expanding volume (4.7M) shows initiative buying away from value.
• 10/2–10/3: constructive follow-through with closes progressively higher. While 10/3 volume (1.55M) cooled from 10/1, this is typical after an expansion day; price held gains and closed strong (70.46), above key pivot zones.
• Implication: Having left the 66–69 node, the next prominent supply sits in 72–74 (late July–August trading plus pre-gap bagholder supply). The air pocket between ~70 and ~72 can allow swift price discovery.

Moving averages and slope analysis

• 5-day SMA ≈ 68.8; 10-day ≈ 67.9; 20-day SMA ≈ 67.6 (est.). Price (70.46) > 5/10/20 SMAs; all short-term averages curling higher, 5 > 10 > 20 alignment = bullish.
• 50-day SMA (est.) is near 70 (dragged down by September), now being reclaimed/tested. This is a technical milestone; sustained closes above ~70 bolster a trend phase transition.
• Implication: Bullish short-term trend with early-stage medium-term reversal.

Momentum oscillators

• RSI(14) ≈ 72: mildly overbought. Overbought in early uptrends often “rides” >70 rather than mean-revert immediately; still, it argues for intraday dips.
• Stochastic(14): near the upper bound (>85), consistent with a breakout phase; embedded stochastics favor trend persistence while increases risk of a brief shakeout.
• MACD (12,26,9) qualitative read: Histogram flipped positive and lines likely crossed up around the 10/1 breakout; momentum broadening favors follow-through into the next resistance band.

Volatility bands and channels

• Bollinger Bands (20,2): Mid ≈ 67.6; upper ≈ 70.6 (est.). 10/3 close (70.46) is near the upper band; intraday high 71.02 briefly stretched the band. Expect either: (a) band walk continuation with shallow pullbacks, or (b) modest mean reversion to ~69.4–70.0 before another push.
• Keltner Channels (20,1.5ATR, ATR≈1.6): Mid ≈ 67.6; upper ≈ 69.98; current sits slightly above the upper Keltner, typical of breakouts and often followed by a midline retest within 1–2 sessions.

ATR and expected range

• ATR(14) ≈ 1.6. For the next session, a typical day’s range from the 10/3 close implies ~68.9–72.1 as a 1-ATR envelope. A 1.5-ATR excursion could probe ~72.9 on the upside or ~68.1 on the downside.

Support/resistance map (confluence)

• Immediate supports: 70.2 (10/3 pivot point), 69.7–69.8 (prior resistance turned support and 9/5 high region), 69.12 (10/2 close), 68.56 (9/30 close / 38.2% retrace of 9/17→10/3 impulse), 67.67 (9/29 close / 50% retrace), 66.89 (9/25 close / 61.8% retrace).
• Immediate resistances: 71.02 (10/3 high), 71.26 (R1), 72.06 (R2), 73.1 (R3/structural), 73.8 (late-July cluster), 74.11 (pre-gap close / gap-fill target).

Fibonacci structure

• Swing 9/17 low (64.32) → 10/3 high (71.02): 38.2% = 68.46, 50% = 67.67, 61.8% = 66.87. These align tightly with September closes and should act as layered, high-quality supports on any deeper retrace.
• Measured move (neckline ~68.8–69 from a rounded/inverted H&S base with trough ~65–65.5): height ≈ 3.3–4.0 → objective ≈ 72–73. This harmonizes with R2 (72.06) and the lower edge of the supply zone.

Ichimoku snapshot (qualitative)

• Price has broken above the likely Tenkan and Kijun after 10/1; a bullish TK cross is probable. The span A should start rising, and price is attempting to clear the recent “cloud” (which would have sat near 68–69 after the base). Early cloud breakouts often retest the Kijun (≈69–70) before trend continuation.

On-balance volume / volume profile

• OBV (qualitative) has turned up sharply since 10/1. The volume shelf 66–68.5 is now below price (supportive). Next prominent shelf sits in 72–74 where older supply may re-engage; expect stickiness near 73–74 if reached.

Candlesticks and microstructure

• 10/3: strong close near highs with only a modest upper wick; not a reversal bar. 10/1 was a wide-range expansion day (bullish marubozu-like), often leading to 2–5 days of upside drift punctuated by shallow pullbacks.
• Gaps: Tiny gap-up 10/3 vs 10/2 close; not material. The large 8/28 gap remains partially unfilled; markets often “seek” pre-gap closes over time, making 74.11 a medium-term magnet.

Classical pivots for next session (using 10/3 H/L/C: 71.02/69.18/70.46)

• Pivot P = 70.22
• R1 = 71.26, R2 = 72.06, R3 = 73.10
• S1 = 69.42, S2 = 68.38, S3 = 67.58
• Expectation: Early dip probing P (70.22) or S1 (69.42), with buyers stepping in toward 69.4–70.2. If sustained above P, a grind to R1/R2 is favored.

Mean-reversion vs momentum diagnostics

• Momentum says trend continuation (5>10>20, MACD positive, OBV rising). Mean-reversion says near-term overbought (RSI>70, price near upper bands), so best entry is weakness into support rather than strength.

Scenario analysis (24h)

• Base case (55%): Dip to 69.6–70.2, then rally to test 71.2–72.0; close near 71.0–71.6.
• Bull extension (25%): Minimal dip; quick push through 71.3 to 72.1 (R2); possible spike to ~72.5; stalls below heavy supply at 73.
• Pullback risk (20%): Deeper retrace to 69.0–69.4 (S1) or even 68.4 (S2/38.2% fib) before stabilizing. Breaks below 68.4 would question the immediate breakout timing but not the broader attempt.

Trade plan (next 24h)

• Strategy: Buy-the-dip continuation.
• Entry: 70.10 (limit) near the daily pivot (70.22) to capture mean-reversion into first support while maintaining breakout exposure.
• Target (TP): 71.90, just below R2 (72.06) and ahead of the denser 72–74 supply to increase fill probability within a 1–1.5 ATR day.
• Protective risk (for planning): A prudent stop would sit around 69.10 (below S1 69.42 and Friday low 69.18) to avoid noise and keep risk contained if the breakout fails intraday.
• R:R (indicative): Entry 70.10 → TP 71.90 = +1.80; risk 70.10 → 69.10 = -1.00; R:R ≈ 1.8:1 within a 24h horizon.

Key risks and invalidation

• Immediate invalidation below ~69.0 (loss of S1 and the 10/2 close). A close back inside the 69–68.5 shelf weakens the immediate breakout and raises odds of a deeper fib retrace to 68.46/67.67.
• Overhead supply re-engagement near 72–74 could cause sharp intraday rejections; hence target set just below R2.

Bottom line

• The setup favors a buy-the-dip entry for a push toward 71.5–72.0 over the next session. Structural context (post-gap base breakout), rising momentum, and supportive volume shift outweigh near-term overbought readings, which are better used to time a pullback entry rather than to fade the move.