EMP.A, Sobeys update

Hamilton

emp.a dec 21 2012

This one was very easy, clear as a bell, except you have to wait more than 3 years before the wedge becomes evident (Aug. 5, 2011). After that it essentially does nothing for another year and a half. Especially if you tried to play this with options ,  time decay would have caused you to lose money. However now might be the time to give it another try. That the stock will drop at least to $35 is a virtual certainty, it is just a matter of time.By the looks of it the stock has traced out a first wave down followed by a (almost?) completed wave 2 rebound. Next should be a wave 3 (or a second wave 1) and things should accelerate to the downside. If at first …..

CM , Can. Imperial Bank of Commerce update

Hamilton

cm dec 20 2012

Here is another longer term look at the “Commerce”. The count is not entirely clear but certainly the tangent changes after each set of parallel lines or channels. The green channel going over the entire chart is the level to which the stock might drop if it regressed back to the mean. Wave 3 is steeper than 1 and 5 is steeper than 3. The take-off point, say 1995, coincides roughly with the Greenspan cheap money world. At the bottom there are just a few random events that called for some form of intervention. The least know is the one in 1988 when Wood Gundy was essentially bankrupt having bitten off a bit too big a chunk of British Petroleum. It was a forced marriage between brains and brawn. The dealer had the brains and the bank the dough, both needed each other even if WG was the most desperate of the two. Amusingly CM is now the only bank that is run by an investment advisor proper! Leason, the guy that killed Barings single handidly , is now giving speeches on risk management.

Just looking at this chart tells you that , should this stock drop back into the green zone it really would not be that outrageous. A sell in our opinion as we are about to enter wave 3 of C

WAG, update

Hamilton

WAG dec 20 2012

We started analysing (if that is the word) this stock in July of 2011 with a sell. When it got to about $32 we reversed our recommendation with a target of about $ 38 (see previous blogs) . The high so far is $37.75 so we do not want to quibble about a quarter. Next stop should be closer to the $21 lows.

RIM update

Hamilton

Then (Dec. 12th) and now charts;

rim dec 12 v2012rim dec 20 2012

It is always heartening to see that the EW approach does sometimes lead to superior results.  It certainly is better than listening to the noise from BNN.

The stock did go to about $15 (overnight) on wave 3 as anticipated  (Nov. 22 blog) but then things cooled off pretty fast and now we are down 20% or so. This is probable (repeat; probable) part of wave 4. Often waves 4 become triangles and need some time so there is little need to stick your neck out now. But the largest move is usually the very first leg of the triangle so you might miss out on some of the action. $10.05 is where wave 4 could go.

We would be inclined to wait this out. There is a possibility that we are actually already in wave 2 down in which case we could go even lower. At about $9.50 it would be a buy in all cases.