It is difficult to say if this technical analysis will hold up to any news out of China this weekend, as well as if the recent bearish momentum in Chinese stocks has subsided. But, if a near term correction is over, here are some price targets for WATG and what to look for in the price motion.
WATG has been a volatile stock to follow. With the recent low of 8.00 being tested, WATG may have found support for traders. This 8.00 price target was 3% lower than the low end projection in the previous analysis for a wave 1 correction.
A look at a 15 minute chart from the 8.01 low on 11/23/10 shows a potential price zero point. The magnitude of wave 1 will be 8.01 – 8.82 on 12/06/10. At this time frame the 8.50 price high shows up as a wave 3 of this move, following this price is a consolidation wave 4.
The projected break out to wave 5 began around 8.31 and completed at 8.80. This brings trading in WATG to the actual 8.82 high, it then skirted higher to 8.89 after correcting to an A wave low of 8.51, 8.50 projected.
The subsequent correction to 8.25, a C wave correction target 6 cents off projections, is where WATG was trading on Thursday 12/9/10. This could be a wave 2 low. The parent wave 3 target high would be 9.82, but lets focus on the shorter term targets of internal wave 1 of 3.
If internal wave 1 of 3 begins at 8.25, looking at a 5 minute chart, make 8.38 on 12/9/10 an internal wave 1 of this move towards 9.82. In doing so 8.54 develops as a wave 3 target.
WATG traded to 8.55 today. With 8.54 as projected wave 3, a wave 4 triangle correction projection would develop the following price motion. For wave A: 8.365. And WATG corrected to 8.38. For wave B: 8.48. WATG has so far traded to 8.46. For wave C: 8.41. WATG has traded to 8.40. The correlation has been good so far.
What this could mean is that WATG is going to trade out of this internal wave 4 to its parent wave 1, internal wave 5, target of 8.73. A correction for wave 2 is projected at 8.47. Then wave 3 of 3 should begin and trade to 9.24. Wave 5 of 5 of parent wave 3 is the original target of 9.82 derived from the initial wave 1 magnitude of 8.01 – 8.82.
Wave 3 is always easier to spot than wave 5, so also look for projected internal wave 3 structures to develop at shorter time frames within the volatility- targets of 9.02, 9.32 and 9.57.