Lennox International (LII) Elliott Wave analysis — Correction ahead before the next rally
|LII stock enters a wave IV corrective phase, offering potential buying opportunities before a strong bullish wave V rally resumes.
Lennox International (LII) has been in a strong uptrend for many years, following a clear Elliott Wave impulsive structure. The stock recently completed wave III on the monthly chart and is now entering a corrective phase marked as wave IV. This pullback is a healthy part of the overall bullish cycle and offers opportunities for long-term investors.
Expected Elliott Wave structure
The ongoing correction is likely to unfold as a three-wave structure, which is highly probable due to the principle of alternation, given that Wave II was a flat correction.. The first leg, wave ((A)), is expected to drive prices lower in the short term. After that, a wave ((B)) recovery may follow before wave ((C)) completes the correction. Once wave IV ends, wave V is expected to begin, likely pushing prices to new highs. This upcoming rally could offer strong potential for long-term investors.
At present, LII is trading near $578 and showing early signs of weakness as the correction begins. However, the broader uptrend remains intact as long as prices stay above the invalidation level at $19.72. Traders should avoid aggressive selling during this phase and instead prepare to enter when wave IV nears completion. Watching Fibonacci retracement zones and blue box buying areas can help identify possible reversal levels.
Final outlook
LII remains in a larger bullish cycle despite the ongoing corrective phase. Patience will be key, as a deeper pullback in wave IV can create attractive entry setups before the next rally in wave V begins.
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