Phunware, Inc (NASDAQ:PHUN) skyrocketed 1,471% higher on Oct. 22, in tandem with Digital World Acquisition Corp (NASDAQ:DWAC) and due to an article from May 2020, which highlighted a partnership between Phunware and the former Trump campaign. The stock then consolidated the move with an inside bar on Oct. 25, but broke bearishly down from the pattern the following day after the company filed a $48.5 million share common stock shelf offering.
- On Wednesday, Phunware consolidated the move lower with an inside bar pattern and on Thursday the stock formed a second inside bar, which creates a double inside bar pattern.
- The double inside bar pattern is a form of consolidation and on Thursday Phunware had lower-than average trading volume, which also signals consolidation.
- The eight-day exponential moving average on the daily chart can be used as a guide for traders already in a position. The eight-day EMA is trending upwards, which is a good sign for the bulls, but if the stock drops below the eight-day lower prices may be in the cards.
- For traders not already in a position, a bullish or bearish entry could be made when the stock breaks up or down from the double inside bar pattern. Traders will want to watch for large volume candles, on smaller timeframes, when Phunware breaks up or down from the pattern for confirmation the pattern was recognized.
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