Alcatel-Lucent SA, big picture

The shares of Alcatel-Lucent SA have been dropping significantly from 13.80 to 0.70. As shown on the weekly chart, this decline is in impulsive fashion. At the bottom of wave 5, that 95% crash must have brought desperation among shareholders. Ironically, it was the right time for a switch in psychology, so when the fifth wave ended, a three-rally normally begun.

alcatel 1

In order to see whether that 3-wave recovery is truly in progress or not, we will take a look at the time period in the white square.

alcatel 2

On the daily chart of Alcatel-Lucentwe can count almost finished impulsive wave. We see that price is getting choppy and overlapping, so we can assume that wave 5 will be an ending diagonal. When wave A is complete, waves B down and C up will have to develop. Of course, there is always a possibility of labeling them 1-2-3, instead of A-B-C, because prices will hardly fall any lower than 0.70. If they do, this company may be forced to go bankrupt.

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