Morgan Stanley Elliott Prediction using wave and fib analysisA cluttered chart showing with all my work of predicting a 60-70% upside opportunity in Morgan Stanley.
Target: $65-70 depending on time with more upside if breaks out of long term channel.
Stop at 34.31 below golden zone of 2 to 3 Elliott wave move. As low as $33 (50% retrace of waves 1-3 move).
MSBR34 trade ideas
Morgan Stanley's chart is under strain. Break imminent. Morgan Stanley investors are not expecting anything overwhelming from earnings , the warning signs seemed evident as early as May, when JPMorgan's CEO Jamie Dimon projected that his company would see M&A and capital market revenues drop 10% in the second quarter, likely the result of clients postponing deals amid lingering trade policy concerns and a turbulent Brexit process. This is for sure going to be the case for all the banks this quarter.
On the positive side the management have claimed that its investment backlog is very solid, while the stock remains undervalued.
It seems that it is just too risky to get involved prior to earnings as the chart is technically looking weak, there is hope that the stock could break higher as it is in a very tight trading range wedged between Ma's.
LONG ABOVE $45
SHORT ON BREAK BELOW $43 WITH HEAVY VOLUME
LONG Options Trading: Morgan Stanley(MS) Buy Call $49 Exp: 7/19Understanding The trade:
As an options trader my goal is to identify trend change and utilize a breakout strategy to leverage profit off of major trend changes with minimal risk. Even though this contract does not expire till 7/19 I will be looking to take profit by early july(see green box) as the rate of decay factor starts to come into play as the contract approaches expiry. This should correlate nicely with the Fib Retracement lvl of .786. If you have any questions please feel free to comment below and follow. Thank you and trade safe.
Reasons For Trade:
• Bounced off the Feb & Mar 19' low of 40~41 lvl
• Broken downward channel (1D chart May 1st -June 3rd)
• Broken RSI Channel
• RSI Overbought > 30
Trade Parameters:
• Broker: Robinhood
• Cost For Entry: Free
• Contracts: 20
• Entry Price: .10
• Risk: $200
• Reward: $600
• ROI: 300%
• Risk/Reward Ratio: 1:3