The only known pattern that fits this stock is that of the expanding diagonal triangle. A bit of a misnomer as it is not a triangle at all but we will leave that for others to argue about. The characteristics of this pattern is that it runs from the bottom left to the top right, hence the diagonal part. It should do this in 5 waves, as in 3-3-3-3 so each individual wave , either up (3) or down (2), subdivides in three waves. Alternation between 2 and 4 is common but not necessary. Unique to this pattern is that it is the ONLY one that can have overlap. It is always a 5th wave or a c-wave, that is the end of the ride! All these conditions are met so we assume that because it is yellow, quacks and floats, it is a duck. Apart from all this it also “double-tops” taking about fourteen years to do so. Short-term we seem to have completed a wave one down, which is then retraced almost entirely. Where we are now is less clear but these “diagonals” are normally retraced in full which would mean a target in the order of $20. By the way, this company is in the healthcare business, primarily drugs.
