Tyler Technologies (NYSE:) offers proprietary software solutions to the public sector in the U.S. The stock has been falling ever since Donald Trump returned to the White House in early-2025, due to fears that public spending cuts would translate into lower revenue for the company. Alas, enforcing financial discipline at the government level proved to be next to impossible once again. In fact, the budget deficit is on track to reach a new record high in 2026. In other words, as far as Tyler Tech and its peers are concerned, the government’s bark is worse than its bite.
Revenue and earnings are actually expected to rise this year, just like they did last year and the year before. In the meantime, the stock is down more than 50% from its all-time high reached in February, 2025. Should investors see this sell-off as a buying opportunity then? It depends on their time horizon.
The 4-hour chart shows that the crash from $661 to $271 is a textbook five-wave impulse pattern, marked (1)-(2)-(3)-(4)-(5) in wave A. The five sub-waves of all three motive waves are visible, as well. As usual, wave (3) is the extended one, while wave (5) is an ending diagonal. According to the Elliott Wave theory, a three-wave correction follows every impulse.
In Tyler’s case, this means that a notable recovery can be expected in wave B, before the bears return to drag the stock under $270 in wave C. The resistance area near $460 looks like a reasonable target for the bulls to aim at. However, they better not forget that Tyler Technologies stock is likely still in a downtrend and be ready to leave once a three-wave structure to the upside is in place.
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