Magna International Inc. declined from $74.50 to $42.09 (A-B) below its falling 40-week Moving Average (40wMA) and then settled in a bullish "W" formation (dashed lines). The stock had a breakout above this pattern (C), pulled back toward its rising average (D) and now appears ready to resume the up-trend (E).
Behaviour indicators including the rising 40wMA and the rising trend-line (solid line) confirm the bullish status. Only a sustained decline below $56-57 would be negative.
Point & Figure measurements provide targets of $69 and $74. The large "W" formation supports higher targets.
Monica Rizk is the senior Technical Analyst and Ron Meisels is the president of Phases & Cycles Inc. (www.phases-cycles.com). And he tweets at @Ronsbriefs. They may hold shares in companies profiled.
Chart source: www.decisionplus.com
Monica Rizk
Ron Meisels