VET, Vermilion Energy update

VET dec 13 2014vet dec 13 2014 s

Vermilion Energy moved into our target zone but it did not follow the diagonal pattern possibility that was brought up (see purple lines). In order to do that it should have stopped dropping a little sooner. S here is a new plan B.

   There is a very clear triangle in the Bigchart and what is more, it is situated perfectly in the middle. This is normally a sure sign that we are having to do with a B-wave. However the total distance travelled is way too far to make that plausible. Therefore it has to be a 4th wave. Typically that is where the correction goes to. In this case we are already in the range but there seems to be one down leg still missing. So $42,93 might just be the number we are looking for.   This would stop wave A down and give us a solid rally, perhaps by as much as $15 or more. Then leg C should take the stock lower.

VET again

vet diagonalford diagonal

We are intrigued by the possibility of there being a “diagonal” in the Vermillion stock. For comparison purposes we dug up another diagonal that occurred a few years ago in Ford’s stock. In that case it was a 5th wave whereas in the case of VET it is a c wave. 5th or c the structure should be identical from the starting point. I will let you be the judge. Remember that you can enlarge the charts and move them around for a better comparison. Also, below, we have a count that could possible explain how this fits together;

VET dec 3 2014

In this count wave 3 is the longest which is normal but waves 2 and 4 (so far at least!) do not alternate which raises the suspicion that potentially a triangle might be forming.  In any event the stock fell precisely to the bottom trendline and cannot fall much further (about $3) as then there will be overlap. At this stage, given the situation in the oil industry it is highly unlikely that this stock would shoot up as a result of generic factors. Consequently we would look for stock-specific or idiosyncratic factors, perhaps a take-over. We will see.

VET, Vermillion again

VET 2 dec 2014

This chart potentially displays a complete a-b-c correction starting at the peak of $77 or so. The c-leg is an expanding diagonal triangle which is a pattern that normally reverses itself violently, most often to the point where it started, in this case $72. That sounds like a little too much but that is why this is EW, don’t think, just observe. And that is what we will do in the next few weeks.

VET, Vermillion Energy

vet dec 1 2014

Vermillion has a nice 5 wave sequence going into the recent top. The only thing not clear is where wave 4 actually fits in. For the moment it does not matter all too much as  the first target is about $45, this is that 4th wave under one count which is also where the trendline runs. Keep an eye on this one.