SU, Suncor update.

su july 11 2015

Notice that this stock lacks the symmetry that was so obvious with the XEG. Moreover, if there is a triangle over the past 6 to 7 years, it could already be complete or require just a minor move up to around $45. Alternatively we could be looking at a failed c of B and we are already well into the downtrend, that is in wave 3 of C (see previous SU  blog).

     Regardless of EW, it must be pretty evident to any reader that does a little iThinking every now and then, that a break of the fat beige line, that is some 20 years old and has 7 or 8 points on it, spells disaster. That is roughly at $30!

P.S. The problem with long-term charts is that you often lose the resolution as the data points go from minute to minute, to hourly, daily, weekly, monthly etc. Extreme values are shaved off and are not recorded. The second high point in 2014 is actually about $2.65 higher than the one in 2011 so there can be no triangle and the B waive did not fail. This makes the bearish case more imminent. See below;

su july 11 2015 s

SU, Suncor update

su feb 3 2015 bsu feb 3 2015 s

Suncor spent 3 years doing nothing. At its peak this was a $70 stock (with oil at $140/barrel). The move from the lows is most certainly corrective, implying a new low below $20 someday in the future. Looking at the short-term chart, it looks like there were 7 waves into the recent low, one too many. (unless, somehow this is a very ugly diagonal wave c, which would then need a brief new high above the high of 3 years ago – the b simple moves to the right by three years). Therefore we expect a turn soon and the most probable point would be where c=a in the latest bounce. This would be around $41 where the 200 day moving average also resides. Note that by that time the RSI would be overbought.

Logic suggest that the stock is too high. If it trades at $70 when oil is at $140 where should it trade when oil is not expected to exceed $75 for the next few years? $35 maybe? What if oil drops to <$40?

SU update

su s sept 2012su april 10 2014

Here we have the usual “then and now” charts; then was in Sept 2012! You will see that the rough target of about $38 may actually be correct if the stock tops here. The timing is way off. This is an a-b-c, the only question being how big the b actually is. At this point that matters little as either way the structure looks complete. A sell.

SU, Suncor update (#12)

su sept 2012su s sept 2012

This is a special edition for my friends (I hope) at an investment club that I occasionally attend. There are now about 12 entries for this stock, some bullish some bearish. Overall you would have made a lot of money following the advise but I know that most people do not preferring to listen to fundamental bla-bla-bla. The question now is what to do if a merger, read take-over was to occur given the various options offered. The stock in question is ETP, Energy Transfer Partners, shown below.

etp sept 2012

ETP is a 10.7 bln. dollar company, SU at 51.8 bln. is roughly 5 times the size. The stocks behave in roughly the same way, even with similar numerical values so there is no reason to expect one to convey value to the other with the exception of synergies of scale etc. etc. From the perspective of owners of SU the impact should be marginal and accordingly the single most important consideration is where is this stock going on it’s own! That is down after this c leg is complete, approximately to $38, that is if there is a c leg. The ultimate target is at $17 or below, when you have $2 to the upside, perhaps as a result of the noise created by this take-over, and $20 to the downside the answer is quite simple that you do not need to evaluate all the little differences in the options, you need to sell now. One of the cardinal mistakes that investors make is that they focus on trivialities and lose sight of the big picture.