ANF, Abercrombie & Fitch

Hamilton

ANF b2 2011 anf s

This stock dropped from about $78 to $47 in a matter of a few weeks. The recent quarter performance was actually quite good despite a “miss” of 14 cents, if you bothered to read the details. This retailer of moderately upscale clothing sold a lot more than the previous year but suffered from a slight compression of margin. Were there warning signs to prepare you for  a drop of almost 40%??

1. The top was actually in 07, and one can argue which of the three is the real one, but the 5 waves up and the very distinct wedge for the 5th wave pretty well guaranteed that that was the top.

2. The fairly clear B-wave from the lows, almost retracing the entire drop warns that the move is not “real”.

3. The triple top, just as in 07 is a classic formation telling you to get out, or at least step aside.

4. The a-b-c corrective wave 2, retracing, again, almost all of wave 1, warns you that it too is not real.

5. The p/e ratio , now at 21 according to Bigcharts must have been in the low 30-ties, not cheap by any standard.

There will be more of these.

SLF again and MFC

Hamilton

slf nov 15 2 2011

Here it is in a little more detail. Today’s low registered at $ 20.96  If there was a triangle wave 5 already has the required 5 wave subdivisions even if they are hard to recognize. If there never was a triangle, a wave 4 and 5 is still required to finish the job.  A move to, say $23 followed by a drop to a new low would do the trick. The 5th wave is already almost equal to wave 1 and time wise we are pretty close to the apex (if that applies). The best you can hope for is about $20.25 and it should happen within two weeks. Little point in waiting!

Unless you look at Manulife which is either making a very complex and incomplete wave 4, or simple just another 4 and 5;

mfc nov 15 2011

If it does that it will likely get to the all time low of $9

SLF, Sunlife Financial

Hamilton

Sept. 22nd , 2011 we had a tentative target for Sunlife around $ 22. Here is that chart and today’s.

slf sept 22 2011 slf nov 15 2011

We have gone a little further than $22, and have done so in a decidedly unclear way. Nevertheless the picture overall suggests a 5-wave movement down to the lower channel trend line at just under $22 is complete. The stock is now earning almost 7% and trades at a p/e of about 7. The end of wave 3 could be as shown, possible making wave 4 a rather awkward triangle; or wave 3 could end at the lowest point in the middle of the channel. Waves 5 and 1 are about equal, a common event.  A rebound of about $5 to around $26 is now highly probable. That would even be the case if we have only finished wave 3, as wave 4 would also require a $5 rebound.

slf nov 15 b 2011

Conceivable this stock could require another C leg up to complete an A-B-C countertrend correction (the B is the a-b-c shown). This is a little at odds with the market overall and , more specifically, the headwinds that insurance companies are experiencing in this low interest, low investment returns environment.