Home Depot Inc (US: HD) spectacular rise has strengthened the bullish case for a wave ((3)) extension. Based on recent price action, Home Depot is eyeing a new high:

1. The extended third wave was initially thought to be completed after a bearish candle hit 200.00% expansion level of wave ((1))-((2)). However, the retracement was cut short after the stock formed a bullish morning star like formation on Friday, signalling a strong bullish momentum ahead.
2. The bullish flag formation is a continuation of the bullish trend.
3. Volume has shown steady increase when the stock make new highs. Particularly the volume increase more than the previous two periods.
4. The golden cross formation is indicative of a strong bullish trend.  

*The technical call is valid for 2 weeks only.

* Should the stock fell below US$260.00 in the mid-term, we will likely see a deeper correction to US$225.00 and beyond.

CHART LEGENDS

Moving average

Red dotted line = 200-day moving average

Blue dotted line = 50-day moving average