Wave 2 of 5 in progress - where does wave 3 begin?

The Elliott wave channel guidelines are some of the handiest tools in the box.

Here the final channel (2-4) is well broken, indicating the impulse is done and wave 2 is in progress, further evidenced in the break of the base channel below. Ideally this decline finds the red channel of the larger degree impulse of which this is proposed to be wave 2 of 5.

Another guideline that fits in with the channels is the 'right look' - such a wave 2 would ideally make a reactionary wave advance into around that green level before dropping to tag the red channel at the 50-61.8% retracement level (perhaps tightened to about 61,233-61,000 USD).

However it gets there though, this level would present a perfect buy setup for the proposed move towards $120K.

As a swing trader, this trade in a vacuum makes me nervous by $56,587.65, abandoning the trade below 53,534.55 and provisionally targeting the $125k area.

As there will usually be chances to increase the position size on pull-backs (imagine wave 2 of 3 for example), the first entry doesn't need to be the whole allocation.