OSK, Osisko Exploration Ltee.

Hamilton

Gold miners from Quebec, started production a year ago, trading at a meaningless p/e of 148, cost per ounce about $858 and dropping and the mill just burnt down. Produce about 400,000 ounces once they get going. Here are the charts;

osk may 2012 losk may 2012 s

If this is the correct count, and it may well not be, wave 4 is unfolding as an A-B-C in which the C is a wedge. It is almost done, probable. At $6 the stock would have lost 62% of its entire value at the peak and has already lost 62% of wave 3. At about $6 overlap occurs and then the count would be wrong, ergo assuming the count is correct then the stock should not trade below that level. The recent move “smells” like an event driven situation, the event being the fire at the mill. These things are often exaggerated as is implied in this particular pattern. A sharp rebound should then follow. An initial target would be $13. A lower opening on Monday, if there is one, should be bought. Use a stop immediately below $6. No guarantees!!!! This stock trades in Frankfurt as well under the ticker EWX.

WPT, Westport Innovations Inc.

Hamilton

Now more than 40 years ago it was fairly normal  to power your vehicle with natural gas. For the price of a few hundred marks, guilders or francs you could buy a conversion kit that would allow your diesel/gasoline vehicle to, also, run on compressed natural gas just by flipping a switch on the dashboard (while driving!). For some reason, that I do not understand, this rather basic technology has not found its way across the pond (perhaps for the same reason that diesel powered cars are non-existent here whereas they constitute almost 45% of all cars in Europe). Now with gas so high and natural gas so low one would think that the light is about to go on, perhaps not with the public in general but with commercial fleet operators. The savings are truly eye-popping.

Westport, together with the likes of Cummings and many car and truck makers, is one of the main innovators in this field. Innovation in this context is a little bit of a misnomer as the technology is proven over and over again. Here is the chart:

wpt b may 9 2012

Back when tech. was king, this stock tried to get to $100 and then dropped to – my guess – $2 in early 2006. I have no idea how to count this, suffice it to say that it could have been a rebound and from here on the stock is ready to dive into the ground. Alternatively we are in a wave 4 (that does not alternate with wave 2) or, and, this may be the most plausible count, we completed a sequence of 5 waves in a new bull market and are presently doing wave 2. All these possibilities are shown in the next two, more detailed charts;

wpt may 9 m 2012wpt may 9 s 2012

In the most detailed chart the stock dropped today precisely to the lowest point in the top triangle. It had a very volatile day as it briefly almost touched $24. This has been straight down from $50. At todays low it is sitting right on the lower long-term trend line. If the stock is in a new bull it should not trade below $22.5 (overlap).  If we are in a bear market a B-wave should develop soon. In that event a rebound of about $8 , to $31 now but a lower level if the stock goes lower first , is pretty common. The long and short of it is that this stock should on the basis of probabilities , be a buy here and certainly if it goes lower.

Note that the RSI and MACD are already heralding a turn. Ask your broker for the fundamentals!

ECA update

Hamilton

eca may 9 2012

The stock delivered the $2+ gain as promised. It will probable  go higher, we simple don’t know with any degree of certainty. The RSI is topping but could stay there for quite some time. In the mean time HNU is up almost 50% from its recent lows. Same story.

MS, Morgan Stanley, brilliant idea–terrible execution!

Hamilton

ms dec 19 2011

This chart is from our December 19 , 2011 blog. It shows the two possible outcomes that could reasonable be expected at that time. Before that we had tried to buy the stock but had chosen a level that was just a little bit too low and was never reached. Here is what happened;

ms may 9

As you can see,the stock went exactly to one of the two targets, the preferred one given the valuation, at just over $21. But that does nothing for you if you are not in the game. Being reckless is not good but being too cautious is not very helpful either. So where now?

ms b may 8 2012

The best guess at this point in time is hat the stock is making a very large A-B-C correction from the $70 high. In this case the structure should unfold as a 5-3-5 A-B-C. Very often, but certainly not always, both legs will tend towards vector equality which essentially means that the longer it takes the smaller the amplitude. The purple arrows give a rough idea how this might play out. It targets about $8 or so and should take another 6 months to complete. Rumblings that Moody is contemplating a credit downgrade, by no less that 3 notches, may precipitate the process. As always , time will tell but we missed an easy double.