COST – Costco Wholesale Corporation

This is a 5 year weekly candlestick chart for Costco Wholesale Corporation (COST). I’ve identified 2 Triangle wave patterns on this weekly candlestick chart. Triangle wave patterns are very useful patterns. They typically occur in Wave 4’s and in Wave 2’s.

The first Triangle wave pattern for COST’s share price was in Wave 4 of a Bullish Impulse wave pattern to the upside. The Triangle wave pattern that just developed over the last several weeks is a Triangle helping to identify a Bearish Impulse wave pattern that is under development. COST’s share price appears to be in Wave 3 of the Bearish Impulse wave pattern.

I wouldn’t feel good recommending shares of COST until its share price gets closer to its main supporting trendline. And it sure does appear to be heading there after the breakout from the Triangle to the downside.

While I didn’t attach a monthly candlestick chart for COST, it developed a bearish Shooting Star candlestick pattern in September 2018 followed up by a Bearish Engulfing candlestick pattern in October 2018. The Bearish Engulfing candlestick pattern was confirmed by selling volume that was greater than the previous month and also way above average.

I would think that like most other stocks, COST probably has several weeks to finish playing out its current downtrend.