AXON - Cup with Handle - 2025-02-18

Axon (AXON) surged 50% in early November following a strong earnings report and the presidential election. It then formed an almost perfect symmetrical cup with handle, with a 21% pullback. The handle was constructive, featuring a five-day shakeout and declining volume.

The stock broke out with 100%+ above-average volume, but the next day, an unknown financial institution downgrade triggered a 15% sell-off with a close at the day's low. The decline continued for four more days, and as of Feb 25, AXON closed around $496, well below its $716 breakout high.

The overall market remains choppy, with growth stocks under pressure. However, using the breakout candle high as a stop would have minimized losses, turning a potential steep drawdown into a small controlled loss.