This 120m chart of LUV shows price action since the stock's December 2017 high. Southwest spent the entirety of 2018 in what appears to be a "complex correction" in Elliott Wave terms. The corrective sequence, labeled W-X-Y, is comprised of two simple A-B-C corrections connected by an X-Wave. Price was largely contained within a parallel trend channel until the final throw-over of Wave C/Y on diverging momentum. The subsequent rally off of 44 has broken above the prior swing high at Wave B as well as the midpoint of the trend channel, suggesting that the correction is complete.
We're looking for LUV to form a higher-low at current Fibonacci support levels before rallying back up to and through the 60 level. The ongoing sequence can be labeled as either a three wave correction (A-B-C) or the start of a new bullish impulse (1-2-3). Either way, we expect higher prices in coming weeks. This pattern could also be labeled an upside-down head-and-shoulders in non-Elliott Wave terms. Initiating a long position at market against the 44 low. Immediate price target is 60 with extensions to 65 and 72.50.
We're looking for LUV to form a higher-low at current Fibonacci support levels before rallying back up to and through the 60 level. The ongoing sequence can be labeled as either a three wave correction (A-B-C) or the start of a new bullish impulse (1-2-3). Either way, we expect higher prices in coming weeks. This pattern could also be labeled an upside-down head-and-shoulders in non-Elliott Wave terms. Initiating a long position at market against the 44 low. Immediate price target is 60 with extensions to 65 and 72.50.