Celanese Stock: What Sparked The Collapse?

Celanese Corporation (NYSE:CE) has faced a relentless downturn since April 2024, with its stock price plunging nearly 78% from ~$170 to around $45. When viewed through the Adhishthana Principles, the decline reveals a clear structural breakdown rather than just a market overreaction. Here is a breakdown of the stock’s Adhishthana Cycle and what lies ahead.

Celanese and Its Adhishthana Cycle

According to the Adhishthana Principles, stocks typically form a Cakra structure between Phases 4-8. This structure, often resembling a channel with an arc, usually carries bullish implications. The stock then breaks out in Phase 9, kicking off the Himalayan Formation, a powerful bullish move.

Celanese seemed to follow this path initially, forming its Cakra from July 2021 through Phase 7 on the weekly charts. But in Phase 8, instead of respecting the lower boundary and preparing for a bullish Phase 9 breakout, the stock broke down. This triggered a bearish move described in the framework as the Move of Pralaya.

As outlined in Adhishthana: The Principles That Govern Wealth, Time & Tragedy:

"When the underlying breaks the Cakra on the flip side, consolidation typically extends into the Guna Triads. The move that follows is highly significant, and selling pressure can be extremely strong. This is called the Move of Pralaya."

Celanese's Cakra breakdown candle itself was brutal; the stock was down by over 32% in a single bar. 

With the Cakra breakdown confirmed, the slump will likely persist until the stock enters its Guna Triads in Phase 14, still a few years away. While some investors and even Citigroup have recently turned positive on the stock, the Adhishthana cycle signals otherwise.

Investor Outlook

While small rallies can occur, they are unlikely to be sustainable. The breakdown signals a deeper structural issue with Celanese, and the long-term trend has turned bearish. For now, treating the stock as a value play may be premature. 

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Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga's reporting and has not been edited for content or accuracy.