Adobe Inc - Tale of Two Charts

Adobe Inc. (NASDAQ: ADBE) is a global technology company. The Company's products, services, and solutions are used worldwide to imagine, create, manage, deliver, measure, optimize, and engage with content across various surfaces, fueling digital experiences.

When I reviewed Adobe's charts a short while ago, I noticed some interesting patterns that I thought you would also find interesting and learn from. From a significant high of $638.25 seen on February 2, 2024, the stock has declined in three waves to a low of $332.01, reached on April 11, 2025. That means the stock had lost almost 50% of its value in just over a year. Isn’t that incredible for a stock of Adobe’s stature?

What can we learn from these charts? I present two charts of Adobe that tell a nice story. Let’s dive straight in:

The second wave, or Wave B, in the above chart, has developed in 3 steps, and reached the 70.7% retracement, where it ran out of steam. You might remember from my book “Five Waves to Financial Freedom” that the third step down is usually the fastest move in any correction. Unlike in an uptrend, where the third step needs an accompanying expansion in volume, the third step in a downtrend is happy to come down even when we are munching popcorn. So, if you ever get on board a third wave in a downtrend, stay put and don’t rush to book your profits too soon!

Now, let us look at the second chart.

You might remember that we use the Fibonacci Ratio Analysis to assist us with making determinations about the likelihood of a turning point. Our primary tool, of course, is the Elliott Wave Analysis. But the Fibonacci ratios are very useful, indeed. You can see here that Wave C reached the 123.6% projection of Wave A, before turning around and producing a 27% rally in under two months! What would you not give to participate in such a rally!

Tomorrow, I am going to send you some more charts of Adobe. So keep a lookout for that email. They will help you learn how to interpret such setups more efficiently. Once you hone those skills, you will soon be able to take advantage of them with the ease of a skilled trader.

Best wishes from Ramki Ramakrishnan.