Three days after we suggested this was a buy, certainly if it went to 80 cents, this stock hit a low and today it has just about doubled on twice the normal volume. There appears to be more potential from here, $3.50 perhaps.
EGPT, Egypt ETF, just a guess.
This is just a guess. This ETF has not existed very long so there is not all that much chart to go by. This ETF should not trade above 16 as then the bearish case is negated. We should get either a triangle or a flat, the difference is not that great other than in terms of time. Then a 5th wave that targets roughly 5 or so. Time will tell.
RIM, Research in Motion
Last time we got out of RIM at $17 and suggested that it might be a buy again under $10. Here we are , well under that so is it a buy? Well above are two different charts of RIM, you can enlarge them and move them around to better compare them. These are what are known as fractals. Not necessarily perfectly identical but very similar structures at different sizes. EW is essentially predicated on the evidence based recurrence of self-similar structures, the most basic of which is the 5 up 3 down cycle. This concept can be helpful at times to verify the validity of a EW count.
On the left chart the stock rises from next to nothing to about $43, then crashes, rebounds and crashes again in a clear a-b-c, ending at about $2.30, a loss of 94.7% On the right the stock does something very similar, peaking at $150 or so. If it does the same proportionate drop the stock should bottom around $7.95, give or take (this is not like cutting a camshaft at tight tolerances on a lathe). Today we are at $7.40;
The new CEO is , no doubt, viewed as a lightweight in North American circles. He is soft spoken, very knowledgeable and when he says “Nothing is wrong” he means it. Here we prefer backslapping, gregarious loudmouths that bluff their way out of every situation. If one can bridge this great cultural divide, it is easier to become a little more constructive. There is 2.2 bln in cash, 75 mln subscribers, a lot of proprietary know-how and patents and their own network. The new product may be late in coming but perhaps it will be fantastic. Who knows, but we would lean toward buying this stock. Even Nortel went from $3 to $12 before it died and just think, if one had bought this stock between these fractals, you would have made 65x your money.
This chart shows how the two fractals fit together;
DJTA, Dow Jones Transportation Average a.k.a the Rails, OSG
The DJTA has outperformed the Dow Industrials, it is also the older of the two. Why has it done so well when shipping companies are down so much? Simple because not that much is transported by Americans , stock listed companies, in America by water. Of the 20 companies in this index only two are classified as “maritime”. One , ALEX, Alexander & Baldwin is a Honolulu based land-owner active in agribusiness, sugar cane etc. At best it runs a few ferries between the Hawaiian islands. The other is OSG, Overseas Shipholding Group. It too has gone down like a rock but as this index is cap-weighted its significance in the index is fast approaching zero. Here are the charts;
We give all three, big , medium and small. We are 100% confident about the big picture, it is nearly there. We are not certain about the triangle , it may not be wave 4 but just part of it, but the final result should still be a little lower. Should be a buy if and when it gets to about $6