Most Traders Chase Excitement. I Prefer Low-Risk Opportunities: CVS Is Today's Example

A real-time Elliott Wave case study showing how defined risk and asymmetric reward can emerge before the crowd notices

24 May 2026

Most traders are taught to chase excitement.

I’ve spent decades doing almost the opposite.

The opportunities I prefer often appear when sentiment is mixed, excitement is low, and risk can be tightly defined.

This weekend, while preparing material for my June 2 San Francisco presentation on using Elliott Waves to identify low-risk trading opportunities, one stock stood out:

CVS.

Not because it is glamorous.

Not because it is making headlines.

Because the wave structure appears to be creating an interesting risk/reward setup.

I am looking for a small dip to buy.

Whether the trade works or not is secondary.

What matters is the process:

Can a structured Elliott Wave framework help identify opportunities before the crowd notices?

Today's CVS setup will likely become one of the examples I discuss in San Francisco.

Charts below.

We start with a recent significant low of $43.56 and see Wave B was a 50% retracement of Wave A

Suppose we label the chart differently, then we get an even more bullish outlook

A conservative approach will be to say we got an X wave after an ABC move and we could get another ABC move up! Notice the X wave was 38.2% of the first ABC.

If the second ABC were to be equal to the first ABC, the target will be above $111.

We will now look carefully at the moves off the X wave bottom. Sub wave 2 finished between the 38.2% and 50% retracement of sub wave 1

Sub wave 3 was extended to reach 238.2% of sub wave 1

We will use the confluence of the two Fibonacci retracements coming at $89.43 as our key short-term support and place our stop below that

Possible targets for sub-wave 5 are shown here

Trading is all about consistently taking bets where the payoff is substantial when compared to the risk we take. I don’t profess to know the future. But I do have an approach that wins over time. I teach these same methods in my online program at https://elliottwaves.com 

Here is the event in San Francisco slated for 2 June 2026. If you are in the area, why don’t you drop in!

HedgeWestSF - Quantitative Finance Meetup

A quarterly meetup for hedge fund and quantitative finance professionals in San Francisco

hedgewestsf.org/events

 

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