In mid November DRYS was in the midst of a consolidating wave 4 pattern that was on the verge of breaking out to larger time frames price targets. Since the prior analysis, DRYS has traded 14% higher.
At the open today, DryShips hit a price target that was mentioned at 6.04. Morgan Stanley then came out with news maintaining the overweight rating and increasing the price target to 9.50 from 9.00, and DRYS was off to the races trading to a high of 6.37 so far.
Taking a look at where 6.37 could be in the price motion analysis. This price is a wave 3 of 3 to the mentioned 7.10 price target. A pull back between 5.71 and 5.33 is expected for this time frame.
A projected 6.34 price target is reached using a wave 1 magnitude from the 3.92 wave 2 low on 8/25/10 to a projected 4.80 wave 1 of 3 high. This wave 1 high turned out to be the 4.99 price high on 9/28/10 shown in the daily time frame chart of the previous analysis.
The chart below is a 5 minute trading time frame chart that shows the divergence of wave 5 to the internal wave 3 at the price high of 6.37. The 30 minute trading time frame has not diverged yet and could produce an internal wave 3 to the 7.10 target of 6.54.
