EXAS Stocks Trade Idea – Long
The Wave5trade Elliott Wave Indicator suite has been used to put together this LONG Stocks Trade Idea on EXAS. As per the chart below the overall bullish trend can be seen and the automated Elliott Wave count indicates the EXAS (Exact Sciences) stock has pulled back against the main Bullish trend on a Wave 4. The wave5trade strategy involves trading the 5th Wave of the Elliott Wave sequence as it is the highest probability move in a “with trend” trade. The Wave 4 has pulled back and found support in our Amber Pullback zone, which indicates a 80% probability that the 5th Wave will go on and make a new high in this current bullish trend.
We can also see that the Wave 4 support was at a previous resistance zone on the Bullish 3rd Wave and therefore a strong Support and resistance aone (blue rectangle zone on chart). This Main Bullish trend started back in June 2016 when the price broke out of an 8 month range bound period as seen on the chart below. We will discuss the remainder of the potential Long trade setup on EXAS below this chart.
There are quite a few elements that are included in our Elliott Wave Indicator Suite for the NinjaTrader NT8, Thinkorswim, MultiCharts and TradeStation Platforms. Lets discuss in order to build up the picture of this potential Long trading opportunity on EXAS.
- The Wave 4 pullback has found support in the Amber Zone of our Specially programmed zones to indicate an 80% probability of the 5th wave making a new high into our automated target zone, in Blue on the charts.
- The 5/35 Oscillator (included in our indicator suite) shows the Wave 4 pullback is between 90% and 140% of the highest point on the oscillator during the 3rd wave.
- The Stochastic has crossed over in the overbought zone and is heading up.
- The Risk to Reward is 1:1.6 to the automated Target zone that our Elliott Wave Indicator Suite plots on the chart. So risking 1% of trading balance between stop loss and entry gives a potential reward of 1.6% into the target zone. The minimum Risk to Reward suggested when trading the 5th Wave is 1:1.6 so in this particular case we are spot on
- The Entry strategy is developed using previous price action, the 6/4 Moving Average High (Green MA line on chart) which is also part of our Elliott Wave trading indicator suite and Movement out of the Wave 4 pull back channel.
So in this case we can see that we have a great deal of evidence that the Wave 4 has behaved as expected and we have a good risk to reward for the trade. This gives a high probability of success for a Long Trade on EXAS with the following.
Long Entry at $50.78, which is way out of the wave 4 pull back channel and above a small 4 week consolidation lvel on the wave 4.
Stop Loss at $38.85 which is below the wave 4 low
Target Zone $70
This can be Seen more clearly on the chart below (click to enlarge, then backspace on your browser to return to this post):
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