close icon

Goldman Sachs to Find Elliott Wave Inspiration

A year ago, in March 2018, Goldman Sachs stock climbed to an all time high of over $275 per share. Unfortunately for the trend-followers, the rest of the year was nothing short of disastrous. GS dipped below $152 in December before closing the year at $167.05 for a total annual loss of 35.2%.

The stock finished at $188.96 last week after the bulls’ ambitions were rejected by the resistance near $206. Goldman Sachs is a financially strong and very profitable company, but that did not prevent the collapse in its stock price last year. Apparently, the fundamentals don’t tell the whole picture.

In order to find out what the recovery from $152 really means we need to examine its Elliott Wave structure. Take a look at it on the hourly chart below.

GS stock - Goldman Sachs Elliott Wave forecast

The sharp recovery from $151.70 to $203.29 can be seen as a five-wave impulse in wave (1/A), labeled 1-2-3-4-5. The Elliott Wave theory states that a three-wave correction in the opposite direction follows every impulse. In Goldman’s case, wave (2/B) looks like an A-B-C expanding flat retracement.

Waves A and B are simple a-b-c zigzags, while wave C is still in progress. If this count is correct, once wave C completes the 5-3 wave cycle the trend can be expected to resume in the direction of the impulsive sequence. Targets above $210 a share make sense in the mid-term, unless the price drops to a new low below $152.

In addition, traditional valuation ratios such as P/B and P/E also suggest Goldman Sachs is currently undervalued. When technical and fundamental methods both point in the same direction, it’s a risk worth taking.

Did you like this analysis? Our Elliott Wave Video Course can teach you how to uncover the patterns yourself!



Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

Can Facebook ‘s Privacy Concerns Fulfill this Setup?

Facebook ‘s privacy policies are under the microscope once again. Personal e-mails uncovered during an FTC investigation reveal Mark Zuckerberg knew of the company’s problematic privacy practices. Facebook stock still hasn’t been able to fully recover from the crash in the second half of 2018, which dragged the price from $218.62 down to $123.02. How…

Read More »

JPMorgan: Risk is High After 10 Years of Bull Market

Between March 2000 and March 2009, JPMorgan Chase & Co. investors saw their holdings’ value decline by almost 78% as the stock fell from over $67 to less than $15 a share. The next ten years, on the other hand, have been a wonder to behold. JPM stock rose like a phoenix from its ashes,…

Read More »

SERV Stock Sets the Stage for a 40% Tumble

ServiceMaster Global Holdings, founded in 1929, is a cleaning and pest control company headquartered in Memphis, Tennessee. The company went public in 2014 and has delivered very generous returns for its shareholders since. SERV stock took off from $11.54 in August 2014 and climbed to as high as $56.50 earlier this month. A 390% total…

Read More »

IAC Stock ‘s Future May Not Resemble its Past

InterActiveCorp. or IAC for short, is a $19 billion media and internet services company. It is the controlling shareholder of Match Group, which in turn operates Tinder – the online dating app. IAC stock was beaten down heavily during the Financial Crisis. In March 2009, IAC stock fell to $13.23 a share, down 92.3% from…

Read More »

Humana Stock Bulls Haven’t Lost the Battle Yet

Humana (NYSE:HUM) climbed to an all-time high of $356 in early November 2018, following a rally from as low as $18.57 in March 2009. In less than ten years, the company rewarded the patience of its investors with a total return of over 1820%, not counting dividends. Unfortunately, the last six months were nothing like…

Read More »

T Rowe Price Vulnerable After Fibonacci Encounter

Founded in 1937 and based in Baltimore, Maryland, T Rowe Price is one of the largest asset management companies in the world. At the end of Q1 2019 its assets under management stood at $1.11T. That is T for trillion. Besides, T Rowe Price is also a public company which is why it is of…

Read More »

Momo Inc. – The Tinder of China Looks Promising

Based in Beijing, China, Momo Inc. operates a mobile-based social and entertainment platform. The company was founded in 2011 and became public in late-2014. The Tinder of China, as Momo is often referred to, first turned a profit in 2015 and has been enjoying strong earnings and revenue growth in the last three years. Momo…

Read More »

More analyses