This one went at least $15 or more above what looked like a top back in January, but today it is $20 below that peak and dropping. Selling gym shoes at $325 or so is a great business if there are takers. Apparently that is the question that seems to have been answered today in the negative. The beauty of momentum stocks is that once the momentum stops there is nothing left, very much like the greater fool expectation. Look for a lot lower.
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Today we ran up almost two hundred points in the last hour or so, supposedly on rumours with regard to the Eurozone. Whatever. The TSX appears to be well into wave 3 of C. The count shown is just a wild guess. Expect the market to go a little higher tomorrow despite horrendous results from RIM, and then the down trend should resume. The normal 5 wave sequence appear to be breaking down into 1-2.1-2 etc etc 4-5, 4-5. It is hard to know where you are but given the a-b-c counter trends we should go lower, probable much lower.
HNU and GAS have worked out reasonable well lately but the next move is not at all clear. There is a possibility that the stocks are working their way through what might become a triangle. If that were to be the case the surprise would be to the downside. If long we would step aside and monitor the situation un till such time as it clears up. When in doubt, get out.
Last December, 2011 we anticipated that the stock was triangulating and consequently needed a 5th wave as a thrust. The logical targets (see that blog) where somewhere between $ 13 and $10 . Today, using the triangle measure that can be fine tuned to $12.50;
However, the triangle can be drawn with sharper triangle boundaries which would move the e slightly to the left and up. This would have the effect of slightly raising the target. Anyway, if short it may be a smart idea to buy back the stock. If buying outright I would wait, at least un till the RSI is well below 30.