The Elliott Wave Principle is known for its ability to help traders and investors analyze both short and long term charts. This is possible, because the wave patterns can be found on all degrees of trend – from the smallest to the largest. It seems that Home Depot Inc. stock is giving us a short term opportunity. The 15-minute chart below explains it.
As visible, there is a very clear five-wave impulse between 106.58 and 116.42, followed by a three-wave correction back to the bottom of wave (4). Furthermore, this area stays close to the 61.8% Fibonacci level, where corrections often end. So, we suspect the zone Home Depot is currently trading in, could provide something like a “double support”. According to the Wave Principle, the uptrend should resume, once the corrective pull-back is over. If this is the correct count, Home Depot stock prices might be close to a bullish reversal. As long as 106.58 holds, we will be waiting for it.