Medallia Inc Elliott Wave Analysis ( 05-10-20 )

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Stock Overview

  • Country : United States
  • Index : NYSE
  • Sector : Technology Services ( SAAS )
  • Ticker : MDLA

 

Fundamental Overview

 

Medallic Inc was only listed last year in July 2019.

Looking at the fundamentals, we can’t seem to use the usual financial metrics to examine this stock because it is a relatively “Young” startup with only around slightly more than a year’s worth of data.
 
 
 
A peer to peer fundamental approach would be a more ideal approach to examining this stock.
 
But adhering to our technical analysis approach using the Elliott Wave Analysis as our main trading and forecasting tool.
 
We shall not delve more into the fundamental details in this blog post.
 

 

Long Term Elliott Wave Analysis

 

From the long term Elliott Wave approach, we observed the following although technically the data available only started in July 2019 last year.

Since its IPO, prices made a small rally but things soon turned sour rather quickly.

Typical of a new IPO startup in my opinion. 

From the charts, we can see prices began plunging down south in a relatively motive fashion.

The overall corrective structure apparently unfolded in a 5-3-5 ((A))-((B))-((C)) sequence in orange, closely following the downtrend channel depicted.

The tail end of the ((C)) leg in orange ended in the Fibonacci extension zone of 100% – 127.2% zone.

This zone is typically a sweet spot for impending reversals.

 

Ultimate Renko Chart MT4 Plugin

 

And undoubtedly, the market reacted in a typical rally.

From April on wards, prices seems to be making a gradual reversal rally in the form of a 1-2-3-4-5 impulsive sequence in white.

Although not quite impulsive in nature, this motive move still manged to push Medallia Inc share price upwards and out of the down channel.

Ending the 6 month rally at an interim high of $40.20 in early September.

 

 

Deciphering The Current Structure

 

Since then, prices are in a corrective mode again.

And typically one can expect a larger A-B-C corrective structure to unfold.

Take note that the impulsive nature of this correction started with a “Gap Down” from the interim high.

This seems to indicate that there may likely be more downside moving forward.

Seemingly, the first leg of the correction see prices retracing to the Fibonacci retracement level of 61.8% at point A in white in a rather impulsive 5-wave sequence.

 

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Primary View

My initial and predominant view is that normally, at around the Golden Ratio fibonacci retracement level of around the 61.8%.

One can typically expect to see prices make a knee jerk effect.

IF prices move gradually upwards in a sluggish corrective matter to form wave B in white.

Then we can expect the continuation of the A-B-C correction in white to be intact ( see my projection ).

My expectation is that the final C leg in white will be pushing prices further down.

If that happens, my projection for the ending range of the C-leg ion white might likely fall in the Fibonacci extension and retracement “Confluence” zone of around $21.07 to $18.65.

 

Alternative View 

However, if you look at wave A in white from a different angle.

And dig into the smaller time frames and somehow managed to count it as a steep A-B-C correction in its own right.

Which is remotely still a possibility.

Then one can expect the current run up in Medallic Inc share price although sluggish to be the start of a potential “Leading Diagonal”.

 

Conclusion

Finally, our job as a trader is to “See Market & Trade Market” according to Price Action.

Although I am more inclined towards my predominant view that Medallia Inc has more room to fall lower.

We must always “Respect” the market and prepared to trade accordingly to how the market unfolds.

And not be too attached to our personal and bias opinions.

 

Please DYODD before taking any trades based on our blog’s Elliott Wave analysis.

 

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For more articles on the Elliott Wave Principle, check out our other posts in our  Elliott Wave Blog.

 

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