$MC : Luxury Producer LVMH Provides an Opportunity to Join the Rally
Moët Hennessy Louis Vuitton, commonly known as LVMH, is a French multinational luxury goods company. Headquartered in Paris, LMVH was formed 1987 through a merger of the fashion house Louis Vuitton (founded in 1854) with Moët Hennessy (established in 1971). The company controls and manages 75 prestigious brands under the umbrellas of 6 branches: Perfumes and Cosmetics, Wine and Spirits, Watches and Jewelry, Fashion Group, Selective Distribution, and Other Activities. LVMH is a part of CAC40 index. Investors can trade it under the ticker $MC at Euronext Paris and under $LVMHF in US in form of ADRs.
From the first days on the stock exchange, $MC title is in a permanent growth. From the fundamental point of view, this behavior may demonstrate a steady need of luxury goods in the society. Even though the wealth in the world is unequally distributed, however, the growing demand in luxury products is obviously present. The latter should be rising even stronger in the coming years. This development should advance, without any doubt, the luxury giant LVMH to new highs.
In the initial article from October 2020, we have forecasted the break of January 2020 high to take place. We were right. $MC has not only broken 439.05 highs, but the stock price has printed an all-time high in January 2022 at 758.50. Here, we provide an update and outlook.
LVMH Monthly Elliott Wave Analysis 06.29.2022
The monthly chart below shows the LVMH stock $MC listed at Euronext. From the all-time lows, first, the stock price has developed a cycle higher in wave (I) of a super cycle degree. It has ended in August 2000 at 98.70. From the top, a correction lower in wave (II) has unfolded as an Elliott Wave zigzag pattern. It has printed a bottom on September 2001 at 28.40.
From the September 2001 lows, LVMH has broken to new highs and is still within a strong rally. This rise shows an extension of more than 4.236 multiples in relation to the length of the wave (I). Without any doubt, one can qualify the cycle higher as the blue wave (III). From 2001 lows, it shows 7 swings higher. Currently, the 8th swing in red wave IV is unfolding as a double three structure. Once finished, the 9th swing within wave V should end the impulse in wave (III).
Indeed, motive sequences develop in 5–9–13–17 — … (5+4 x n) swings. Therefore, one should expect a new high above 758.50 which will provide the 9th swing from September 2001 lows. On the one hand, a new high and 9 swings may accomplish the 2001 cycle higher in blue wave (III). On the other hand, they dont have to. As mentionned above, 13, 17 and more swings within cycle in wave (III) are also possible.
LVMH Daily Elliott Wave Analysis 06.29.2022
The daily chart below shows in more detail the 8th swing lower. From the all-time highs in January 2022 at 758.50, the pullback in red wave IV is unfolding as a double-three correction. First, 3 swings of black wave ((W)) have bottommed in March 2022 at 543.90. Then, a bounce in wave ((X)) has printed a connector at 675.20. Later, a new low below 543.90 has opened a bearish sequence. Therefore, more downside within black wave ((Y)) should take place. Currently, wave © of ((Y)) is in progress.
Investors and traders should be looking to buy LVMH in a pullback from 460.23–327.43 area targeting towards 828.89 and possibly higher.