Retrieving Data
What Is the Volatility Contraction Pattern?
The Volatility Contraction Pattern (VCP), popularised by Mark Minervini, describes how a leading stock behaves while it digests a strong advance. After running up, price pulls back — then rallies and pulls back again, but each pullback is shallower than the last. The swings tighten, the daily range contracts, and volume dries up. The stock is transferring from weak hands to strong hands and coiling for its next leg.
This tracker scans the ASX for stocks forming a genuine VCP base inside a confirmed uptrend, classifies the exact kind of base, scores it from 0–100, and marks the breakout level — the top of the base that price must clear on a volume thrust to trigger the move.
The Four Base Types Detected
A powerful, fast pole (a run-up of 40% or more) followed by a short, shallow, tight base — often just one clean pullback. The strongest and rarest of all bases.
The textbook pattern: two to six successive contractions, each shallower than the one before, with a tight final contraction (≤10%) over a base of at least three weeks.
A brief, shallow consolidation with no qualifying pole — a quick reset near the highs that can still resolve higher.
A longer, tight rectangle that holds near the highs while the moving averages catch up — a sign of patient accumulation.
The Three Gates — All Must Pass
A stock is only marked trackable when every one of these is true:
The base must form inside an established, rising trend led by the stock. The moving averages are stacked bullishly, the MA100 is rising, price sits well above its 52-week low and within 20% of its 52-week high, and relative strength versus the S&P/ASX 200 is positive. This is continuation, not bottom-fishing.
The consolidation must classify as one of the four base types AND show genuine volatility contraction — either the ATR has fallen since the base began or Bollinger Bandwidth is sitting near a three-month low. A base drifting sideways at wide range does not qualify.
Supply must be exhausting. Average volume during the base is below the pre-base level, and there is either a genuine dry-up day recently (volume under half its 50-day average) or net selling volume below net buying volume. Quiet volume in the base makes the breakout thrust significant by contrast.
The Breakout Trigger & How Candidates Are Tracked
A trackable VCP sits in the Watching tab while price is still below the breakout level. The breakout fires when a green candle closes above the breakout level. Volume is no longer a gate — the trade triggers on the price break regardless of volume, and each card shows the relative volume that confirmed it (day volume ÷ 20-day average, recomputed every hourly scan as intraday volume builds), so a strong-volume thrust (≥1.5×, green) is distinguished from a lighter breakout (amber) at a glance. The trade then moves to Breakout, with the entry set at the breakout close and a hard stop at the base low.
The Watching list is kept strict: on every re-scan a stock must still pass all three gates. The only way to leave Watching and be retained is to break out. If a stock has not broken out and no longer satisfies every gate — the uptrend breaks down, the base widens or stops contracting, volume picks back up, or price loses the base — it is dropped from the watchlist entirely rather than archived. This keeps Watching free of stale or failing setups. (Should the same stock form a fresh qualifying VCP later, it can be detected again.)
The Winner and Invalidated tabs only ever hold resolved Breakout trades — real positions with an entry and an exit — so the performance stats reflect actual triggered trades, not setups that quietly faded on the watchlist. The tracker re-scans every hour during ASX market hours, and you can force an immediate re-scan with the Refresh Scan button. Each candidate stores its full candlestick history and indicator footprint, so the chart shows the base, the MA20, MA50 and MA100, and the breakout level exactly as the scanner measured them.
Technical Indicators Used
Every chart on this page plots the indicators the scanner relies on. If you are new to trading, here is what each one means:
Disclaimer: Market Flow provides this information for educational and informational purposes only. Nothing on this page constitutes financial advice, investment advice, or a recommendation to buy or sell any financial product. All prices shown are 20–30 minutes delayed and are not suitable for active trading decisions. Past performance of any trading setup is not indicative of future results. Trading ASX securities involves significant risk of loss. Always consult a licensed financial adviser before making investment decisions.
