SLF, Sunlife Financial

Sept. 22nd , 2011 we had a tentative target for Sunlife around $ 22. Here is that chart and today’s.

slf sept 22 2011 slf nov 15 2011

We have gone a little further than $22, and have done so in a decidedly unclear way. Nevertheless the picture overall suggests a 5-wave movement down to the lower channel trend line at just under $22 is complete. The stock is now earning almost 7% and trades at a p/e of about 7. The end of wave 3 could be as shown, possible making wave 4 a rather awkward triangle; or wave 3 could end at the lowest point in the middle of the channel. Waves 5 and 1 are about equal, a common event.  A rebound of about $5 to around $26 is now highly probable. That would even be the case if we have only finished wave 3, as wave 4 would also require a $5 rebound.

slf nov 15 b 2011

Conceivable this stock could require another C leg up to complete an A-B-C countertrend correction (the B is the a-b-c shown). This is a little at odds with the market overall and , more specifically, the headwinds that insurance companies are experiencing in this low interest, low investment returns environment.