Those high-flying growth stocks popularized during the pandemic — like Shopify (SHOP), Roku (ROKU), Block (SQ), Zoom (ZM) — are crumbling under the 2022 selloff. Joke’s on me, huh? Well, technical indicators now suggest those same growth stocks will soar once again!

Look no further than Cathie Wood’s ARK Innovation ETF (ARKK) — a collection of the market’s momentous growthy stocks. It’s surging of late. ARKK is up about 17% over the past month. Compare that to the S&P 500’s paltry 1.5%.

But that’s first-level thinking. Digging deeper, our thinking concludes that Cathie Wood’s stocks are forming a rare technical pattern — a “bullish ascending triangle.” Here’s the kicker: Bullish ascending triangles typically precede massive breakouts.

Cathie Wood stocks aside, we’re seeing breadth indicators flashing super bullish signals across the tech sector right now.

Put it all together, and the picture comes into focus. High-flying growth stocks appear to be on the cusp of a massive breakout.

The last time these stocks broke out in 2020, millionaires were minted as their stocks went parabolic. We’re looking at a potential repeat in 2022-2023.

It’s time to back up the truck and load up on growth stocks.

Bullish Ascending Triangle

Speaking of parabolic, let’s go back to 2020. (I know, it seems like decades ago because of “pandemic time.”) At that time, the growth of Cathie Wood’s stocks could only be properly described as nothing short of parabolic. Then, those same high-flying stocks came crashing down.

Now, a rare technical pattern indicates that growth is about to go parabolic once more.

Since early June, the ARK Innovation ETF has formed what’s known by traders as a bullish ascending triangle pattern.

The ETF has formed a flat resistance line around $45. Its support line is rising — from $35 to $40 to, as of press time, $43. On the chart, this trading action forms an ascending triangle.

When this ascending triangle converges — or when the flat resistance line converges on the rising support line — the underlying asset typically sees a massive breakout.

Right now, the ARK Innovation ETF’s flat resistance line is at $45, and its rising support line is at $43. A convergence is basically here.

What comes next? Technical analysis says a massive breakout in growth stocks.

We agree — but for reasons beyond just this bullish technical pattern.

Bullish Breadth Indicators

Per our analysis, Cathie Wood stocks won’t be the only ones that partake in this coming surprise breakout rally.

The whole tech sector should catch a ride, too.

Like Cathie’s investments, tech stocks have recently outperformed the broader market. As a result of this rally, a historically foolproof bullish breadth indicator has been triggered for tech stocks.

Indeed, this week, the number of Nasdaq 100 stocks trading above their 200-day moving average crossed from below to above 20%. That’s a bullish breadth crossover signal that always leads to big rallies.

When I say always, I mean always.

Since 2008, this signal has led to positive tech stock returns over the following 60 days 100% of the time. The average return in that stretch? 15%.

In other words, one of history’s most reliable bullish breadth indicators likely triggered tech stocks toward a massive short-term breakout.

Couple that with the ascending bullish triangle forming in the ARK Innovation ETF. The data implies that you should buy growth stocks right now to score big gains over the next 3 months.

The Final Word on a Breakout in Growth Stocks

I don’t like repeating myself, but some statements bear repeating. To that end, stocks have been crushed in 2022. You know it. I know it. Our portfolios definitely know it. Consequently, investors are running from the markets to hide from the collateral damage. But don’t despair! I’ve just laid out a mountain of (growing) evidence suggesting that, not only is the worst of the selloff over, but a massive market rebound is also on the horizon.

Here’s the thing: That rebound will only be concentrated in high-growth stocks.

Those millionaire-minting stocks from 2020 could see a repeat performance in the second half of 2022.

One such stock is a tiny $3 technology stock. It may be the most compelling 12-month investment in the market today.

See; the world’s largest company — Apple (AAPL) — will reportedly announce a brand-new product over the next 12 months.

It’s not another iPhone, Apple Watch, or iPad. It’s an innovative new product that could be bigger than all those products combined.

And per my analysis, the $3 stock I’m talking about is positioned to secure a partnership with Apple. If that happens, it will supply a critical piece of technology to make this new product hum.

Quick market tip: Apple supplier stocks don’t trade for $3. Just look at Skyworks (SWKS) stock. That’s a major iPhone parts supplier. It’s trading for $100. Long ago, though, it also traded for $3.

See what I mean?

The tiny potential Apple supplier I’m talking about could easily trade for $100 soon. Again, it’s only a $3 stock today.

And I’ve unpacked all the important details of this $3 stock in a special presentation here.

On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.