I'm going to start off the Charts of the Day Video with a few of our recent wave setups that have been posted, and then go over a few other charts of interests that look like some decent potential setups as well.
A recently posted wave set up by Zac was NBR, which was positive on the session. Obviously, that's constructive, given the strong move down in the broader tapes that we saw today. The stock tried to turn up off of the recent low that was made as a possible B wave within wave (3). I'm counting it a little bit differently than Zac, who has a possible 1-2, 1-2 within a standard impulse to the upside. It doesn't really affect the expectations near-term or how you would approach this as a trade setup.
In either case, the suggested stop is below the low that was made last week here, below this B wave low, at around 78. So as long as we're holding above there, we're looking for price to turn up in the start to that of the wave C of (3) or possibly wave 3 of (3), if this overall structure from last year’s low is an impulse rather than the diagonal.
Next up is TER, which is sitting currently at a 61.8% retracement of the move up from the March low into the high that was made at the end of April. So if this is a 1-2 start to our wave C of 3, this is an ideal spot for price to attempt to turn back up from in wave iii of C and does offer good risk/reward using a stop underneath that low that was made in March to play for the potential continuation in the rest of wave C and turning up in wave iii of C next.
You can actually make an argument for either a diagonal structure or an impulse for that C wave. I think it's reasonable to get 5 waves up for the wave i, so it doesn't necessarily have to count as a diagonal. Once again, it doesn't really affect how you would approach the trade. And actually the targets would probably be relatively similar: Around 171 would be ideal to reach for that wave iii of C.
Next up, and one of the charts that I posted as a set-up today, was Coinbase (COIN), which is a newer issue. So we do have to approach it with a little less confidence as we don't have as much price history here. But it does have what looks like a very convincing 5 wave structure off the low that was made last week where price bottomed in this target support range for a possible A-B and then a measured move C wave, which it ended up reaching pretty much in a measured move Fib at the low last week before turning up and producing this 5 wave structure to the upside.
So when I posted that wave setup, I mentioned that I was expecting a little bit lower before this wave 2 of B wave completed. Closer to that 50% or 61.8% retracement would be ideal at 277.31 or 270.74. It stretched a little bit closer to those levels going into today's close and could even get a little bit closer to those levels tomorrow before trying to turn up in either the red C wave or the blue wave 3.
Especially if we do reach that 50% or 61.8% retracement or in between there somewhere, I would say an attempt at a long entry between those levels does offer great risk/reward using a stop. If you want a tighter stop you can place it below 78.6% at 261.65, or if you want to give it up at full invalidation, that would be below the low that was made last week at 250.50.
Moving on to UEC, I wanted to update this wave setup. It was previously posted as setup near the end of April as price was turning up from the previous low here where it looks like a wave 4 flat completed. As posted previously, the question is just how far along within that 5th wave was price? Were we just completing the wave i and going to see a wave ii pullback, or was it more nested to the upside?
The former has appeared as the better interpretation of where we completed that wave i. Price is now pulling back on wave ii of 5, slightly below the 50% retracement and approaching the 61.8% at 2.70. So if you missed that first entry from the end of April or you wanted to add to the position, this is actually a decent spot to do so, near the 61.8% retracement at 2.70, with the same stop still below that April low until we get a cleaner start to wave iii. If you want a tighter stop, that would be below the 78.6% at 2.53.
View our complete Charts of the Day Video here. The video also includes analysis on BA, REGN, BMY and AMGN.