CrowdStrike Holdings, Inc. (CRWD) is a prominent cybersecurity technology company based in Austin, Texas. The company provides various services, including cloud workload and endpoint security, threat intelligence, and cyberattack response services. The forecast for CRWD was made three years ago, with the expectation of ending a significant market cycle in a specific area marked by a blue box on the chart. The forecast suggested the completion of an impulse as wave (I), followed by a substantial correction as wave (II).
Looking back six months later, it is evident that wave (I) ended in the projected blue box area, forming an ending diagonal at 298.48. The market reacted as anticipated, completing a double correction as wave (II) at a low of 150.02, precisely at the 50% Fibonacci retracement level. This bounce indicated the end of the pullback and the resumption of a rally towards breaking the previous high.
Fast forward three years, the current weekly chart reveals that the cycle previously thought to have completed at 150.02 was only a part of a more extensive double correction. The cycle comprised wave “w” ending at 150.02, followed by an expanded flat correction as wave “x” that concluded at 205.73. The final push lower marked the completion of wave “y” at a low of 92.25, finalizing wave (II) pullback. While the anticipated rally was expected to start in January 2022, it actually commenced in January 2023.
Following the low at 92.25, CRWD exhibited a clear upward impulse, with wave ((1)) ending at 166.99 and a subsequent pullback as wave ((2)) concluding at 140.52. The substantial rally led to new all-time highs at 365.00, culminating in wave ((3)). Wave ((4)) retraced to 280.88 before rallying again to complete wave ((5)) at 398.33, also representing wave I of (III). However, a sharp drop followed, causing a 50% decline in the stock value.
The Current Scenario
While the pullback may indicate the completion of wave II, there is a possibility that it is part of a broader wave II structure. The global market sentiment suggests bullish exhaustion, potentially leading to further downside for CRWD. Wave ((A)) of wave II concluded at 200.81, with expectations of a corrective rally that should not exceed the previous high at 398.33. Subsequently, the market is anticipated to resume lower in wave ((C)) of II before resuming an upward trajectory.