Sometimes in Elliott wave, we can get a good clue as to the future without having to know the full picture. Let’s take a look.

This chart shows the share price of Vodafone PLC, the multi-national Telecoms company. After establishing a low in March of 2020, the share price then rallied into a May 2021 peak. That high corresponded to the level where the second rally in the advance equaled the first.

Using the Elliott guideline of equality between waves, that gave us a clue that the three-wave advance from March 2020 was a corrective A-B-C pattern. When the share price then declined below the Wave A high, it made it even more probable.

In September 20, 2021, noting this price action we stated, “Vodafone Group PLC topped in May at exactly the level where the rally from October 2020 equaled the rally from March to June 2020 in percentage terms. That plus the subsequent decline makes it likely that the rally was corrective,” adding that developments “point to a bounce followed by a further decline.”

After the five-wave decline into November 2021, Vodafone did bounce and crucially did not make a new high. After that, the share prices continue to decline in a textbook Elliott wave fashion.

This example shows us that being aware of Elliott wave guidelines can help us in anticipating the future. If you want to know what’s next for Vodafone and many others, stay tuned to the European Short Term Update.