Yahoo! Inc. is ready sell its assets with Verizon Communications and YP Holdings among the candidates willing to acquire Marissa Mayer’s company’s core business. Mayer agreed on selling Yahoo’s properties after pressure from Starboard Value. But you can read all that in every financial website, so are we bothering you with it? Because all of these events happened after February 5th, 2016. Why is February 5th so important? Because it is the day “Yahoo to Finally Catch a Break?” was published. In that article shared our opinion that “while there seems to be no end in sight for Mayer’s troubles, there is no reason why Yahoo! stock could not rise.” Our positive outlook on the stock was motivated by nothing more than the chart below.
The Elliott Wave Principle, which was applied to this chart for the purposes of analysis, says that if you spot a five-wave impulse, such as the one shown above, you could expect a three-wave move in the opposite direction. That is all. There was no way we could have known what the future was holding for the company itself, but we did not need to, because the natural market cycle is much more important. Let’s see how Yahoo stock looks like today, two and a half months after the forecast.
The price of the stock began rising almost right away and is currently hovering around 36.50 dollars a share. Most would say the reason for this speedy recovery are the acquisition talks, but as you clearly saw, it has been predicted much earlier. Instead of searching for pseudo-reasons, we would say that this was another occasion, when the Wave principle managed to put us ahead of the news.
What to expect from now on? Well, the recent recovery appears to be a just single wave. We need three. So, it seems we could expect a small decline in three-waves for wave B, before the bulls take Yahoo stock to the area between the 50.0% and 61.8% Fibonacci levels in wave C.
What other markets are you interested in? Prepare yourself for whatever is coming. Order your on demand Elliott Wave analysis now or pre-order one of our 8 Premium Forecasts due out every Monday. Stay ahead of the news in any market with the Elliott Wave principle.