SKYT is not a perfect name, but the VCP action made me take a deeper look.
The earnings are not great. Last quarter was still negative, although it did improve from the prior quarter, and estimates look better going forward.
Fund ownership also dropped almost 50% last quarter, which is not something I ignore.
But price is still king.
And when SKYT showed up on my scanner, the technical action stood out.
After a huge move of well over 100%, the stock started tightening up near its highs:
28% pullback.
13% pullback.
9% pullback.
That is classic volatility contraction.
The final pullback came on lower volume, then volume came back in on the breakout to all-time highs.
That is exactly what you want to see.
Again, this is not a perfect name.
But it has strong ROE, decent margins, strong sales growth, exposure to a strong semiconductor group, and strong relative strength.
This is why I don’t look at one data point in isolation.
Price is still the final judge.
The best setups are rarely perfect.
Would I prioritize a name with better earnings and stronger fund ownership?
Absolutely.
But I also don’t ignore setups with strong price action, tight volatility contraction, and volume coming in at the right time.
