KO, Coca Cola.

ko july 2011

Just like Pepsi, Coke may have some trouble ahead, again there is nothing wrong with the stock, it yields 2.7% and trades at a P/E of about 13. The stock has been out of phase with the market for some time now but the pattern is pretty clear. Looking at a more detailed chart;

ko july 2011 s

The c-leg up has already travelled as much as the a-leg (a common equality), and is forming a wedge of sorts that does not leave much room, in fact the $70 high may be as good as it gets. A normal 62% retracement of the entire bull market occurs at a little over $32. No idea why this might happen but soon 1/3 of North American (and the world?) will be overweight. Soon diabetes will affect 15/20% of the north American population. Schools are getting annoyed with vending machines that do not sell the right stuff etc.etc. etc. In short there are many reasons why selling sugared water may become less popular soon.