EOSE Breakout Eminent Wave Analysis and Current Setup
The chart reflects a potential Elliott Wave 5 bullish count: Wave (1): The initial impulse move upward from the recent bottom, Wave (2): A corrective pullback that retraced a portion of Wave (1), forming a higher low, Wave (3): Anticipated continuation of a strong upward move, aiming for Fibonacci extensions around $6.38, $7.06, and $8.16, Wave (4): A projected minor corrective pullback, Wave (5): A final upward push towards the 161.80% Fib Extension at $8.94.
The green trajectory outlines this bullish wave setup.
Key Support Levels: Immediate Support: $2.39 (50% retracement), Interim Support: $1.71 (23.6% retracement), Major Support: $0.61 (absolute low).
Key Resistance Levels: First Resistance: $4.28 (78.6% retracement), Wave Resistance: $6.38 to $8.16 (Fibonacci extensions, critical for Wave 3 completion), Major Resistance: $9.94 (200% Fib extension).
RSI and Momentum: RSI: Trending upward at 71.58, suggesting the stock is nearing overbought conditions. However, strong upward momentum could sustain RSI in the 70+ range for longer during Wave 3, MACD: Bullish crossover with strong momentum supporting the uptrend.
Volume Trends: Noticeable volume spikes coincide with upward price movement, confirming institutional interest or heavy buying pressure during breakout moves.
Market Sentiment: The presence of Fibonacci resistance clusters around $6.38 to $8.94 indicates strong confluence and potential selling zones. Traders might take profits near these levels.
Trading Strategy: Current Positioning: A tight risk setup is indicated with a $0.50 stop-loss, providing a favorable risk-reward ratio.
Entry Point: Around $3.89, where price currently trades.
Profit Targets: Short-term: $4.28 (78.6% retracement), Intermediate-term: $6.38 (123.6% Fib extension), Long-term: $8.94 (161.8% Fib extension).
Stop-Loss Placement: Below immediate support near $2.39.
Options Play: Consider selling cash-secured puts at $2.50 strike or targeting covered calls near $6-$7 resistance to capitalize on premium.
Conclusion: EOSE is exhibiting a textbook Elliott Wave bullish structure supported by Fibonacci extensions and volume confirmation. The setup offers significant upside potential with clear resistance targets while maintaining a manageable risk profile. Traders should monitor RSI and volume for momentum validation during Wave 3’s progression.
