close icon

Illumina, Now and Then

A little less than a year ago, Illumina Inc. was one of the wonder stocks in the market. Starting from below $28 in October 2011, it managed to rise to the 200-dollar mark by March 2015. But instead of allowing the majority’s optimism to guide us, we decided to take a look at Illumina stock through the perspective of the Elliott Wave Principle. On March 4th, 2015, we published “Illumina Not As Healthy As It Seems” to tell investors about the warning signs, visible on the weekly chart of the stock. See it below.
illumina 4.3.15
As you can see, the whole uptrend since October 2011 looked like a clear five-wave impulse with an ending diagonal in wave 5. According to the theory, every impulse is followed by a three-wave correction in the opposite direction. In addition, the RSI indicator was showing a strong bearish divergence. So, in our opinion, the best decision was to avoid Illumina stock like the plague, regardless of what the company’s fundamentals were saying. Now, in February 2016, we know we made the right choice.
illumina 9.2.16
Truth is, Illumina continued to the north for a while, only to make the following crash much more painful. The stock climbed to $242 in July 2015. However, the new top only made the ending diagonal in wave 5 look bigger and pose a greater threat. The count remained the same in and so did the anticipated outcome.
Two days ago, on February 8th, Illumina fell as low as 130.31, which means the stock lost nearly $112 of value per share since in July, 2015. The Wave principle, once again, fulfilled its purpose to prevent us from making the wrong decision in the worst possible moment. In this case, it would have been a very costly mistake.
What to expect from now? The theory postulates that after every 5-3 wave cycle, the larger trend resumes in the direction of the impulsive sequence. Having that in mind, we would expect a recovery, once wave C eventually ends. The upcoming rally should be powerful enough to exceed the top at $242.

Stay informed with our newsletter

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

Privacy policy
You may also like:

MongoDB – Bearish Pattern Joins Nosebleed Valuation

MongoDB Inc. is a general purpose database platform developer and provider. The company was founded in 2007, but only came public ten years later – in 2017. During the following four years, the stock has risen from an IPO price of $33 to $515 a share as of last week. So, it is fair to…

Read More »

Pandora Does Things Right. Stock May Need a Breather

When we wrote our previous article on Danish jewelry maker Pandora in December, 2020, the stock was up over three-fold since March. That recovery from DKK 180 to DKK 651 didn’t not come out of the blue, though. It was the result of a bullish setup we managed to identify as early as July 2019.…

Read More »

Match ‘s SP500 Inclusion a Good Excuse to Reach $200

Match Group Inc. rose over 10% in post-market trading Friday following reports that it is going to be included in the S&P 500. The company, which owns Tinder, OkCupid and most other major dating apps in the U.S., has a market cap of over $41B. Despite the anticipated “summer of love”, though, this is not…

Read More »

Cameco Stock Seems to Have Finally Turned a Corner

Uranium spot prices are on the verge of breaking above $34/lb, up over 80% from the bottom of $18/lb reached in late-2016. Cameco, as one of the world’s top uranium producers, is now seeing its stock price rising in tandem. Yesterday, it closed at $19.16 after reaching $21.95 in June. We first covered Cameco in…

Read More »

A Fresh Look At Cigna ‘s Elliott Wave Super Cycle

In a case study article on Cigna, published in October, 2016, we examined how a fundamentally sound and undervalued stock can still drop nearly 90%. The reason for that crash didn’t lie in some company specific issue. Rather it happened to occur during the biggest financial crisis in 80 years. Nevertheless, we made the point…

Read More »

CBOE Takeover Rumor Lifts Stock to Elliott Wave Target

We first wrote about CBOE Global Markets less than eight months ago. The S&P 500 had already recouped all its COVID selloff losses and was hovering at new all-time highs. CBOE, in contrast, was still down 30% from its 2018 record, trading below $97 a share. For some reason, the market was ignoring the company’s…

Read More »

Ahead of Ulta Beauty ‘s 150% Gain Since Lockdown

Buying shares in a beauty retailer in March 2020 sounded like a crazy, stupid idea. Stock markets around the world were plunging at a record pace amid a global GDP crash resulting from government-enforced lockdowns. People were stockpiling necessities in preparations not to leave their homes in the foreseeable future. With COVID-19 cases rising everywhere,…

Read More »

More analyses