Priceline Group Inc: These 3 Charts Show Where PCLN Stock Could Go Next

Priceline Group IncBullish on PCLN Stock

The year 2000 was marked with an asterisk for the investment community. It was the year when the NASDAQ-lead technology bubble finally burst. In 1999, Priceline Group Inc (NASDAQ:PCLN) stock hit a high of $990.00, but in 2001, shares hit a low of $6.30, representing a 99.36% loss. Essentially, the entire position was lost. If I were a shareholder of PCLN stock, I would have never imagined I would ever see my hard-earned dollars again.

However, like a phoenix, PCLN stock has risen from the ashes. Not only has the stock seen its share prices recoup all the losses, but also shares managed to go on to make new all-time highs. Incredibly, a 99% loss has been erased.

The story doesn’t end there, though…

If we use Priceline’s past trading behavior as a window to its future, it’s clear that PCLN stock isn’t done soaring just yet.

Here, I will attempt to walk you through the stock’s history and outline some important technical behaviors that have embedded themselves in and reinforced Priceline’s current trend.

To start, the following chart illustrates the bottoming process for PCLN stock:

Priceline Group Inc NASDAQ

Chart courtesy of

The bear market that decimated PCLN stock ended when the stock chart put in a double bottom. A double bottom is a trend pattern that signals a bear market has ended.

The double bottom began forming in late 2002, when shares retested their late-2000 bottom of approximately $6.30 per share. The bottom was only confirmed in 2007, when shares finally broke above the peak that separated the double bottoms. It took eight years to form and confirm the bottom in Priceline stock.

The following chart illustrates the new uptrend that has developed in PCLN stock and the method I used to draw the uptrend line:

Priceline Group Inc NASDAQ Chart

Chart courtesy of

Fibonacci retracement numbers (highlighted by the green lines above) are a very popular tool used by many technical traders. They are used to identify counter-trend price objectives. In theory, when a stock pulls back from a primary trend, shares will retrace the primary move by 50%–62%. This zone usually acts as support for the share price, as traders will be eyeing this area when entering long positions or covering short positions. Elliot wave theorists equate this type of pullback to wave two of a five-wave pattern.

The 62% level is significant on another front. It also represents the level at which PCLN stock broke out and confirmed its double bottom. Patterns have a history of returning to breakout levels and testing them from the other side. In actuality, the share price of PCLN stock overshot to the downside on the back test. The good news is that shares were unable to follow through on the overshoot.

I chose to draw the trend line penetrating the lows in 2008, assuming that the share price did indeed overshoot. When I do this, the trend line becomes defined and orderly. As long as this trend line stands and shares are trading above it, PCLN stock is bullish. A breach of the uptrend line would be cause for concern.

The following chart is used to illustrate a possible price objective for Priceline stock:

Priceline Group Inc NASDAQ INDX

Chart courtesy of

The chart of PCLN stock looks like a giant bowl. The previous all-time high that was forged in 1999 is now serving as a horizontal support zone. The pattern isn’t perfect, but it is suggestive of much higher prices ahead.

Giant bowl-shaped reversals tend to produce mirror images once the bowl is complete. The price objective based on the depth of the bowl is $1,973.70. PCLN stock could potentially provide a return of 46% from its current trading levels.

The Bottom Line on PCLN Stock

PCLN stock remains in a bull market that began in late 2003, when its shares retested their lows at $6.30. In 2014, PCLN stock reached a new all-time high, providing investors with a price objective of $1,973.70. If shares can keep trading above the uptrend line, that price objective will remain intact.