The Long Scenario: Once Wave 5 completes, we need to see where. There are a number of potential support zones between 206 and 202 areas, the 197.50 area and 192 area. Extreme Price Zone support refers to my particular setup that can result from a false breakout occurring as Wave 5 attempts to push new lows. This is one area to look for long validation. And just below that there is overlapping support. The fact that we are trading above this area informs us that this is a healthy retracement and not overly . The magnitude of this can make for a significant reaction provided there is a strong broader market to support such a move. As a day trader watch these areas for reversals and validation and be extremely cautious with shorts. As a swing trader, watch for the setup and validation near the extreme price zone. Since this stock is generally strong, the average target of 220.50 area (See Long Target Area on chart) is not unreasonable. Stops must be defined at the time of entry. The swing trade can take up to a week or more to play out and will require a strong broader market to support the move.
Would you like to conduct your own analysis like this? Analysis and trading are two separate processes. How exactly do you use this information for trading? My Trader's Workshop Series addresses this. Learn how to analyze and trade any financial market on a technical basis which includes price action, order flow and other short term refining techniques. When it comes together, you have the qualities of a consistent trader. Read my article about the elements of a consistent trader here: http://www.unconventionaltrader.com/321