Instead of rising as hoped in August, BXB's price has drifted lower and fallen back below the overhead resistance downtrend line. In a downtrend and making lower troughs and peaks is not positive and the stock did fall marginally below my stop loss before recovering a little last week. The $10.25 stop loss was a level of support (more of a narrow band) which I hope will be the point the stock does recover from to build on last weeks 4% move up. That level is also a 50% retracement of the last significant peak and as such can usually be considered a strong support level.

Elliot Wave count with BXB is unclear and I'm hoping that the recent March high is not a failed Wave 5 (due to the Covid fall). If that is the case price could be expected to recover but perhaps not above $12. In that scenario, if price does rise, closing out the trade at the first appropriate time might be the best course of action - ie live to fight again another day!

11 August 2020

BXB’s price reacts strongly to economic downturns with major retracements apparent in 2002 and 2008 (GFC when price fell 73%). Price has been travelling in a large rising price channel for over 30 years. Elliott Wave suggests price has possibly finished Wave 4 and is rising into Wave 5 which has the potential for price to return to the top channel boundary around $16. Price remains in a technical uptrend despite falling back a little recently. From the March low (following the Covid fall) price has been making a pennant pattern which has a target of $14.47 Should price break above $12.24 there is an argument this would be a resistance break pattern with a target of $14.16 These targets are still well short of the large long-term price channel. The probability of a rise out of the pattern is much more likely than a fall, but that doesn’t mean it is guaranteed.

The time to buy would be when price breaks and closes above the pennant upper boundary with some volume.