SU, Suncor

SU June 2012

The last few weeks saw oil dropping rapidly. Looking, once again, at Suncor oil should go quite a bit lower, this despite the longer term outlook that we are running out of this stuff. Commodities are priced at the margin and consequently the long-term outlook has very little to do with what oil might do over the next few months or even years. Using Suncor we can reverse-engineer where oil should go. The chart is perfectly clear. First the big A leg down followed by the retracement which happens to be near an ideal 62%, clearly 3-waves. Then the stock does it again only at a smaller degree. This is wave 1 of C. It too is followed by a 3-wave retracement of about 62%. Now THE major rule of EW is that 5-wave moves are in the  prevailing direction of the trend, and 3-wave moves in the opposite direction (counter-trend) Ergo the trend is down (even if the actual count is incorrect!) Both a-b-c’s are as plain as daylight. How exactly C will develop is a different matter altogether, but down to $17 or so is a good initial guess as that is where C equals about 62% of A.

(see also previous SU blogs).

SU Suncor

su apr 2012 ends

Suncor (see previous highly precise blogs), of course fits the above pattern to a T, the only difference being that it is not yet as far as 5N Plus. If the C ends up being more or less vector equal, it should make a new low below $18 and could do so on a point on this circle. It would certainly come as a surprise to many that seem to be wedded to the idea that gold and oil have nowhere to go but up. Time will tell!.

You can enlarge both charts and move one up so they end up being side by side. The similarity will become more compelling , especially if they are properly aligned with regard to time!

SU, Suncor update

su jan 2012

Notwithstanding the obvious fact that we have NOT reached the target as suggested in our previous blog, we would exit this stock tomorrow. You should be up $4 or almost $5, which is a respectable 15%+ for a few weeks. There is a real possibility that this stock will not go beyond $34 which would leave a wave one down followed by a 2 up.