Raytheon Technologies Corp is a leader in the aerospace and defense sector, gaining strength from recent geopolitical events. Analyzing the stock using the Elliott Wave pattern shows a strong potential breakout. According to the Elliott Wave analysis, RTX has been on the rise since its low in 2020. Wave I reached $106, Wave II hit $68, and we are currently in Wave III. A weekly analysis indicates that we will see three waves that could lead to new highs. The stock is expected to complete five-wave advances from both 2020 and 2023, aiming for $222. In Wave ((3)), there’s potential for Wave III to go beyond $250. RTX is likely to undergo a series of third and fourth waves. The important level to watch is the April 2025 low of $112, which must hold to avoid corrections. Any pullbacks are buying opportunities, typically occurring in patterns of 3, 7, or 11 swings. The bullish trend suggests further price increases are possible. Traders should look for entry points during daily pullbacks, using the Elliott Wave method for timing. The proprietary Blue Box system can help identify reversal zones, increasing clarity and confidence. This disciplined approach seeks to capture the next big move for RTX. The aerospace and defense sector continues to grow, driven by recent geopolitical tensions and rising government spending. The FY2026 defense budget recently passed with a 7% increase in funding for advanced missile systems, which are crucial for RTX. This supportive environment backs the technical indicators we’ve been tracking. Reflecting on our predictions from January 2026, the technical plan we laid out last year has been accurate. The critical level of $112, based on the April 2025 low, was never broken during minor market corrections in the latter half of 2025. This confirms the strength of the trend and prepares us for the next major upward move. Traders in derivatives should use daily pullbacks to prepare for a move towards $222. Buying call options that expire in three to six months can amplify this expected gain. Strikes around $190 to $200 can offer a good balance between premium costs and potential gains. For a more cautious strategy, consider bull call spreads. This involves buying a call at a lower strike price and selling one at a higher strike price, which lowers the initial cost. This tactic is effective for targeting a specific price move, like an initial jump into the $220s. Another approach is to sell cash-secured puts during dips. This allows you to express a bullish view while earning income. Target strike prices close to established short-term support levels to collect premiums based on the expectation that the stock will remain above those levels. This method aligns well with our strategy of entering the market after a 3, 7, or 11-swing correction. Implied volatility should influence the timing of these trades. When fear or pullbacks occur, volatility usually increases, making the premiums from selling puts more appealing. Meanwhile, entering long call positions is typically more affordable when volatility is low during consolidation. Lastly, the stock’s impressive backlog of $204 billion, reported in Q4 2025 earnings, provides solid evidence for future revenue growth. This reinforces our belief that the current wave structure is well-supported by strong business fundamentals. Each dip offers an opportunity to get in on the ongoing bullish trend that began from the 2023 lows.

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