Year: 2012

TSX update

Hamilton

tsx apr 4 2012

Right now it is not clear what this was. The beginning of the big bear in which case we would be in a wave 3 of some degree that is not finished and then continue down. The alternative , and given the symmetry etc., quite a plausible one is that we completed an A-B-C correction and now we go back up. The thought alone tires me but that is the message for now. The C wave should be 5 waves which is certainly not clear, and in a “flat”, which is what this is, the a wave is usually an a-b-c itself, which it is not. So I would favour the bear case but only marginally.

TSX update

Hamilton

TSX apr 2 2012

We are of the opinion that the TSX is already cooked. The EW count that best fits the action over the past 5 days fully supports this view, at least for now. There was a clear 5 wave drop of about 400 points followed by a 3-wave rebound that has retraced 85%, so far. Today , of course, there is again bullish news, this time ISM numbers from China. Did not know they existed but there you go. Also the Eurozone has the highest unemployment rates since x, again very bullish as this will help a European QE whatever get launched etc. etc. In any case if the TSX stays under 12600 we could possible have a start for the bear.

AAPL, Apple Inc.

Hamilton

aapl

Yesterday, on BNN, there was this fellow who, without batting an eye, estimated that Apple will trade at about $1645 by the end of 2015. Roughly, that is an increase of 3x in another 3 years. If you extrapolate the above chart in a linear manner you will obtain substantially higher levels. According to Bigcharts the stock has a p/e of about 17 but you should not look at that for this stock. More important is the price to earnings which is “really” only running at about 2.5 X and could easily double or more just to catch up with the peer group.What peer group would be a reasonable question since it is a universally accepted fact that this company has no peers. When mathematics or logic enters into the equation you can rest assured that the result is wrong.

From a EW perspective there are possible 5-waves up. The ratio’s between them are roughly 1:1.62:1 a common thing. In the great recession this stock was cut in half and then some. Earlier in the decade it had lost more than 90% of its value. Things happen, they always do. Hold on to the stock by all means, but make sure that you are operating with a tight stop.