Carvana (NYSE:CVNA) is currently in Phase 11 of its 18-Phase Adhishthana Cycle on the weekly chart. The stock has been on a strong rally since May 2023, and while momentum looks intact, the Adhishthana Principles raise one important caution investors should keep in mind.

What's Driving Carvana's Rally?

To understand the source of this rally, it helps to zoom out to the monthly chart. Carvana is currently in Phase 2 of its Adhishthana Cycle. According to the principles, Phase 2 consists of two distinct parts:

• Sankhya Move: A consolidative or bearish stretch in the early part of the phase.
  
• Buddhi Move: A bullish phase in the latter half.
  

True to form, Carvana saw a dramatic decline during its Sankhya move, falling from ~$376 to just $3, a nearly 98% drop. However, around the 38th bar, the Buddhi move began, and the stock has since rebounded over 430%, climbing back toward its all-time highs.

While Phase 2 won't conclude until February 28, 2027, the weekly chart introduces a reason for caution in the shorter term.

Weekly Chart: Is a Himalayan Peak Around the Corner?

Carvana has been aligning well with the Adhishthana framework on its weekly chart, particularly from Phase 9 onward, the stage where the Himalayan Formation typically begins. According to the principles, a breakout from the Cakra in Phase 9 sets the stage for a steep rally, followed eventually by a peak and eventual decline, forming a mountain-like structure.

• In Phase 9, Carvana rallied sharply, gaining approximately 387%.
  
• This upward momentum continued into Phase 10, where the stock added another ~191%.

Phase 10 is often where the peak forms, especially between the 18th and 23rd bars. As I outlined in Adhishthana: The Principles That Govern Wealth, Time & Tragedy:

"The 18th interval is expected to be the level of peak formation; if not, then the 23rd interval. If this phase concludes without forming the peak, it is anticipated to occur in the following phases."

In Carvana's case, although there was a brief dip toward the end of Phase 10, it didn't violate any key support levels--indicating that the upward trend remained structurally sound.

Now in Phase 11, the rally is still intact, with the stock gaining another ~144% so far. But with no peak confirmed in Phase 10, the Adhishthana Principles suggest that Phase 11 is the next likely zone for peak formation. This phase ends on April 19, 2026--a key date investors should keep an eye on.

Investor Outlook -- Caution, Not Concern

Carvana's rally since May 2023 aligns with the Buddhi move on the monthly chart. While this phase 2 move will run until early 2027, the weekly structure hints at a potential peak before then--possibly by April 2026. The key level to watch is $292.84 (Phase 10 high). A decisive move below this would indicate that a peak has been made, and the descent of the Himalayan Formation has begun.

Bottom Line:
For now, the outlook remains bullish but cautious. Current investors shall continue to hold, but should keep a close watch on time and price structure as mentioned.