Verizon Communications Inc (NYSE:VZ) found a bottom slightly above 23.00 in October 2008 after a long decline, which started nine years earlier – in October 1999, when the stock was exceeding the $60 mark. Now, it seems the good times are back for the telecommunications company.
In 2013, the price of Verizon’s shares managed to climb above $54, which is a recovery of more than 30 dollars in less than five years. But prices have been moving sideways ever since, trapped in a range between $54 and $45. It looks like neither the bulls nor the bears were able to take control of the situation during the last two years. Maybe the Elliott Wave Principle could help us predict which of the two armies would eventually prevail.
In 1930s, Ralph Nelson Elliott suggested, that market trends move in five-wave sequences, called impulses. As the chart shows, Verizon does not have a complete five-wave structure yet. To be more precise, the stock appears to be locked in a fourth wave triangle. If this assumption is correct, Verizon is likely to stay in no man’s land for a while. However, the bulls should turn out to be the stronger team, leading prices to fresh new highs in wave (5).