Absolutely no idea how to count this. but we are hugging the upper trend-line, not good!
Whatever this is, it looks like it is yellow, quacks, and floats. That does not mean it is a duck but it does mean that you would be foolish to ignore the possibility. It is , of course a diagonal given all the overlaps so you should say, “thank you” and take your leave ASAP, they are reporting tomorrow.
Above is 3M in june or so this year, the big picture. Here it is today:
Notice that wave one and two were not that bad. 2 is , of course an a-b-c correction and should retrace to , about , wave 4 of previous degree, a little above $ 83. It could go higher to 50 or 60 %, close to the 50 day moving average of $87. After that it is downhill.
Mc Donalds has behaved almost like a bluechip. It did not drop as we thought it might, but then it did not progress much at all for the past4 months or so. Long –term this stock is trading above it’s 3 year old channel and is doing a “throw-over”. These come at the end!
From the short-term chart a good case could be made that the stock formed a triangle. This would be wave 4 of 5. The “measurement for this triangle suggests a top at around $94 at best. So now you have $2 or so to the upside and $42 to the downside. The big triangle wave 4 has it’s base at the $50 level and this is almost certainly where the stock will go once it starts it’s trek down. That is, by the way, also true in a continuing bull market.
If odds of 2 to 42 are appealing, then stay with the stock, all others should exit. This , I think, applies regardless of the EW count. It is a simple matter of being prudent or smart and applying the buy low/sell high principal.
On the left the April outlook which was twice adjusted to events in the market. The last one that this was definitely a buy if you could get it under $9 (or thereabouts, of course). It got to $9.05 . On the right what actually has happened. The small c in the B-leg was expected to go to about $17, it only reached $16, but then the stock followed the script pretty well verbatim. What we have here is a wave 2 retracement of wave one up, retracing 50% (which is low for 2’s) and doing so in a 5-3-5 pattern. An alternative would suggest that the C wave is as yet incomplete. This alternative has little credibility considering that all other criteria have been met rather nicely. Wave 5 of C is most likely a wedge diagonal triangle adding certainty to the count. If this is indeed a new bull market the stock could go much higher, but in this dicey environment I would not expect too much soon.
This one could continue up to $16 easily. Before that there may be a wave 2 of 3 up that would interrupt the process. In the meantime the stock is up about 29% from the lows. There is talk that the company will reinstate it’s dividend at next weeks meeting (according to Barclays). It would supposedly be 8 cents a quarter, which, if I calculate it correctly is 32 cents per annum or at a stock price of $11.66 is a dividend of 2.75%, not bad.