VCP (Volatility Contraction)

Bullish74% Win Rate~30 bars to target

The Volatility Contraction Pattern (VCP), popularized by Mark Minervini, consists of 3–5 tight contractions of decreasing depth and duration. Each pivot is 20–50% shallower than the last. Institutional accumulation compresses the range before an explosive breakout.

How to Identify the VCP (Volatility Contraction)

  1. 13–5 price contractions, each progressively shallower (first: 15–25%, last: 3–8%)
  2. 2Each contraction is shorter in duration than the previous one
  3. 3Volume dries up dramatically on the final contraction — "dry-up"
  4. 4Pivot breakout above the last contraction high on volume > 40% above average

When to Trade It

Buy the pivot breakout on the day of the breakout (first 30 min or on close). Stop: 5–8% below the entry (below the last contraction low). Target: the prior base depth added to the breakout. Best when SCTR > 9 and in confirmed bull trend.

EdgeOS integration: look for SCTR above 9, bull count 1–4, and confirmed/fluid bull trend to align the pattern signal with the EdgeOS system for highest-conviction entries.

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Frequently Asked Questions

What is the VCP (Volatility Contraction) pattern?

The Volatility Contraction Pattern (VCP), popularized by Mark Minervini, consists of 3–5 tight contractions of decreasing depth and duration. Each pivot is 20–50% shallower than the last. Institutional accumulation compresses the range before an explosive breakout.

How do I identify a VCP (Volatility Contraction)?

3–5 price contractions, each progressively shallower (first: 15–25%, last: 3–8%) Each contraction is shorter in duration than the previous one Volume dries up dramatically on the final contraction — "dry-up" Pivot breakout above the last contraction high on volume > 40% above average

What is the win rate for the VCP (Volatility Contraction) pattern?

The VCP (Volatility Contraction) has a historical win rate of 74% when traded correctly with volume confirmation and proper stop placement. Average bars to target: 30. Always combine with trend context and market regime for best results.

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Pattern detections updated nightly · For informational purposes only · Not investment advice