Often we are wrong as this market is pushed up by forces that we do not understand, perhaps because they did not exist even a few years ago. Anyway , sticking to what we do understand , here is the TSE. After 2500 or so points straight up we should get at least 800 points down. If it happens this may be the beginning of the next down leg. Remember that Japan also hit its highs at year end as many other indexes/ currencies did. Time will tell.
These charts are from August 2010. Below is today’s chart.
The stock did not drop quite as far is it could have, so perhaps some people missed buying it. Those that did, should consider selling soon for a nice profit. The run up from the lows can be counted in a number of different ways but a simple 5-wave is distinctly possible which would imply a drop back to, say $13. For the more patient investor it may be worth waiting for a serious take-over bid, which , should it arrive, would preclude any further drop.
As you get older you love to hate big pharma, certainly when you start with a father as head of the largest Dutch company, Duphar, telling you every day how the business stinks. These guys are the marketers of the world. It is no coincidence that RBC’s top broker, before he got fired,or should I say shown the door, was from the Montreal pharma industry. But enough is enough, we keep thinking about buying low and selling high and Pfizer fits the bill! More and more people will need lipitor, they will just change the color and get another 25–year patent protection. Perhaps, just perhaps, 80% down was enough. Not yet convinced but willing to put it on the table. Is that a break-out???
Anytime you have 3 vowels in a row you know there is trouble ahead. They could be Russian even though they use a different alphabet , or Irish or even Dutch and drunk. More over if you are in the 2by4 and paper business there must be more trouble. “That having been said” as the saying goes, never mind the incorrectness of the grammar and the pretty boring cliche’ the stock has had an amazing uptrend, before almost meeting its maker. Here is the chart.
So where do we go from here? Of course I have absolutely no idea, but that I have in common with every other jackass that pretends he/she knows. All I have is common sense and EW,using that I would exit any long position at around $23, a 4th wave and an area where the rise from the low, perhaps an a-b-c reaches the point where c= a, a very common event. Also we are reaching a 50% retracement. Using a more detailed chart we would come to the same conclusion.
This thing scares the hell out of me.. Again the top is at around $23 if you can bear to ride it all the way. Is it 5 up or an A-B- C? I have no idea, that is the beauty of EW. Just as religion it keeps you guessing, there are no certainties, just probabilities, which is why the most devout atheist is sometimes seen praying. We will go back to the tried and true approach to investing, that is buy low – sell high and, when in doubt , get out. Both suggest we should exit the scene very soon.