HollyFrontier Corporation is an independent petroleum refiner. The Company produces various light products, such as gasoline, diesel fuel, jet fuel, specialty lubricant products, and specialty and modified asphalt.
I count the top made at 83.28 in June 2018 as the top of wave 3 up, the strongest part of a rally inside the Five Wave Up fractal started off the $1.88 low in May 2000. Off that top we should get a corrective wave 4 down followed by another rally in wave A of 5 up targeting the previous top made by the wave 3. I see two alternative paths for that corrective wave 4:
A bullish scenario (the green path). Right here the stock is testing a common retracement ratio for the whole wave 4 inside a strong demand zone (the green stripe). From here we may get the first leg up of the next rally in wave 5. That subwave A of 5 may retest the previous top made by wave 3 up in June 2018.
A bearish scenario ( the red path). Wave 4 shall have a corrective structure. This drop off the June 2018 top has an impulsive structure. That could be a sign that this drop is only the first leg down in wave A of 4. Under this scenario the stock should go up in a corrective rally of wave B of 4 followed by another drop in the final subwave C of the wave 4 down. That subwave C down may reach a new lower low but may just retest the low made by this first leg down in subwave A of 4 bottoming in 46 sh neighborhood.
This stock was brought to my attention by Ana, a fellow subscriber. If you have any suggestion about potential candidates for a value stock send me your ideas to castawaytrader@gmail.com
The company has great profitability ratios and has a limited debt slightly exceeding annual EBITDA. And the company is cheap. Currently it is traded at 6.6 Price-to-Free-Cash-Flow. It’s a great company with a solid business at a good price! And, as a cherry on the top, it pays nice 2.8% dividend!
10%
6%
29%
6.6
1.15
2.8%