Year: 2015

BLK, Blackrock

Hamilton

blk aug 14 2015blk aug 14 2015 m

Blackrock is one of the largest wealth management firms there is with nominal assets under management in the neighbourhood of 4 trillion or so. The EW labelling is pretty simple, there is either a large triangle wave 4 or a wave B. We prefer the first but point out that the consequences are the same for both. The thrust from the triangle fits the measure of it’s mouth, not precisely but close enough. The triangle might be one notch larger- wave 2 becomes wave e- and then it fits perfectly. The thrust itself (or c of B) is a clean 5 wave affaire and, so far at least, the move down from the top is impulsive.

Needless to say, the potential for much lower prices is excellent. If this would indeed occur with a company that is presently doing so well in the ETF space, it is worrisome indeed for the market as a whole.

KSS, Kohls Corp.

Hamilton

kss aug 13 2015

Here is a schematic depiction of this apparel retailer. We show it for two reasons, neither of which have anything to do with you owning this stock, which we do not expect that you do. This is a great example of why you should, always as a matter of course, sell on a double top. Twice you had the opportunity to sell at around $80 and saved yourself a lot of grief. So far only around 30% the second time – it dropped 10% today alone – but if the EW labelling is anywhere near correct that will soon become 70% or more.

Secondly, it is clear that it took a disproportionate amount of time to complete the b and c waves of the B wave relative to the previous low of wave 4. Everything is moving in slow motion and this is primarily because investors are no longer looking at the particulars of individual stocks. They prefer to be guided by macro economic factors such as the Fed’s next move , the dollar’s value and so on. This only delays the inevitable.

Below we show an alternative which is only of academic value now as all this has passed. It is in red. In this alternative wave A is deemed to have started in 2002. Wave B in that scenario is exactly the same length. C is starting now. I have no idea if this is a valid interpretation nor how useful it would have been in real time, as you would be looking for a 5th wave from the 2008/9 low. That could theoretically still happen all though overlap seems to have already occurred.

kss aug 13 2015 alt

RBA, Ritchie Brothers, Auctioneers Inc.

Hamilton

rba aug 12 2015

To keep it simple, we would sell here. The triangle is not perfect but the stock has gone a long way. A better triangle emerges when you look at a longer time frame.

rba aug 12 2015 b

The risk of being right about this triangle is too big to be wrong.

AMZN update

Hamilton

Then July 24, 2015 and now charts.

amzn july 26 2015 sAMZN aug 12 2015

The high was $580 on the exact date of the previous blog. Today we hit $513 so that is a loss of $67, or 11.55% in 18 days. How did we guess? First EW but secondly the very simple fact that RBCDS put this stock on their list as the top pick. We expect $300 soon as that is the base of the triangle in the chart. In case you are confused, when RBC designates a stock as a top pick it means that they like it a lot, it does not mean that they think it just topped. A month or two from now it will quietly be removed and replaced with another momentum stock that happens to be in the limelight, without an explanation of what went wrong.