Year: 2015

RY again

Hamilton

Then, Sept. 8, and now charts as usual;

ry sept 8 2015ry dec 3 2015

Almost three months ago we had some misgivings about the bear case, at least with respect to our biggest bank. The pattern at the time was just too compelling. On the balance of probabilities it was a rather clear A-B-C corrective flat! As always with EW it is often very difficult to wholeheartedly embrace a possibility that is at odds with your general expectations. At least we put it in a blog. Also keep in mind, as we pointed out many moons ago, that RY trades exceptionally well off the RSI. Invariable both the buy and sell signals, that is below 30% and above 70% work. Keep an eye on that all the time!

Some of the other big banks have similar or comparable patterns. Some do not so one should be careful not to generalize. As far as RY is concerned a new high, that is above $81 is a reasonable expectation. If it happens you will have waited an entire year during which you had to agonize over a loss of 16% in order to earn a 5% dividend. Not something you would want to do a second time.

By the way, a $10 bln. profit for a single company in Canada is a record. Some might think it is deserved, others may think that it is simple obscene.

VRX update

Hamilton

vrx 18 nov 2015

We are still ultimately looking for a low in the $50 range but at this moment in time we would rather be long than short. For one thing, this whole drop could have been a double zig-zag a-b-c X a-b-c. If not there are clearly 7 waves down  so far and that cannot be a 5-wave affair.  Whatever the case given the waning momentum, the RSI and MACD and also the now widespread recognition that there is something wrong with this stock it is time to go long with a tight stop.

GPRO update

Hamilton

gpro 13 nov 2015bgpro 13 nov 2015 s

So we hit the $20 handle today, which was our target as per the previous blog. A dollar or two is still a distinct possibility but it is  not a good risk/reward proposition. In fact a bounce to $30, from here or a little lower, is the most probable EW interpretation. That would present a 50% gain and you are buying well below the original issue price or where the stuff started trading. For citizens of the World these are must-own-cameras as you go down Piz Nair in St. Moritz after your swim with sharks above the Great Barrier Reef in Queensland.

TSX update

Hamilton

The usual the, Oct. 9, 2015, and now charts;

TSX oct 9 2015tsx nov 12 2015 s

Just a quick update. On the left our view as of the beginning of October, Oct. the 9th to be precise. Since then we have dropped about 1000 points.  THAT IS NOTHING! We may now be at the start of wave 3 which could, repeat could, easily become  a 4 to 5000 point decline or more and that would still not be the end of it. It could happen rather slowly, or very rapidly and perhaps even not at all. Time will tell. Below is a possible big picture;

tsx nov 12 2015 b

An example of a stock that has gone down this road a little further would be BTU or BHP which is shown below;

bhp nov 12 2015

Billiton is, of course in the commodities biz, but then so is Canada. The best way not to play this if you are a lender, is to grow your business like crazy at this time , preferable using agents that care less about your continuity. A 10 mln loan may only be valued at 2 mln once this is over.