FAZ , Direxion Financial Bear 3x

Hamilton

FAZ aug b 2011 FAZ aug 2011

By special request. This is for pros only, or at least those that are not faint of heart. This one has come down from such highs that the recent lows are almost certainly a low, implying that the next big move is up(this is the inverse of the financials!). Overlap in EW is not acceptable, but this thing is leveraged 3x and consequently the swings are much wider. With that caveat this, IMO, is the proper count. Given that wave 5 down was a wedge, it should be retraced completely. That would take you to 95 for wave 1. Short-term we are in 4th wave, that seems to be complete already but could develop into a triangle as well. This would take more time but should not lead to a lower low than the most recent one.

CF Industries Holdings Inc.

Hamilton

These guys do specialty chemicals, often used in fertilizers etc. Here is the chart;

cf ny

Not to be confused with Canaccord. This one is a sell simple because we are so close to the double top level, always a good spot to sell. But just as importantly the entire move from the ‘09 lows looks like a wedge.

CF, Canaccord Financial Inc.

Hamilton

cf l cf s

CF is one of a handful of independent investment-dealers, merchant bank type of outfit still remaining. Sprott Inc, that went public about 4 years ago is another one and, despite their high exposure to gold and other such end-of-the-world products are still trading 20% under their issue price. CF has a nicer cleaner chart, it is the one we have seen a thousand times now; a big down-leg, followed by an A-B-C B-wave as a retracement. Next is the next down-leg, already well advanced. A further drop to about $8 is the first target. Ultimately look for a price below $3.

DAX , update.

Hamilton

DAX aug 25 2011

Today the DAX dropped 4+% in a matter of 18 minutes, I assume they were not impressed by Mr. Buffett’s impulsive interest in Bank of America. Others have it that rumors , quickly countered by new confirmations, of credit downgrades across Europe were gaining currency . An even less plausible argument was that since short-selling was banned all over Europe except for Frankfurt, they became the lightning rod for such nefarious activities.  Whatever the case, it fits nicely with the count I had in mind for the DAX as shown in the above chart. There are a good number of variations to this theme but this is roughly what I would expect.  The (intermediate!) low should be around 5100 to 5000. The risk is that things go faster and lower.