Obviously I am wrong in suggesting the HXD was a buy. But the TSE itself is close to the nice round number of 10000 (and a logical retracement point) and as vectors this a-b-c is pretty well equal as it approaches $18. Note once again , the RSI and MACD have already turned. For the moment I am staying with the position.
The DAX is by far the “cleanest†chart of the lot. A further rise to 5250 or another 400 points or so cannot be dismissed but even so the index already made a high in terms of RSI, MACD, and has hit the par. line at 4650 and gone through. Risk /reward does not favour the upside.
Two months ago I suggested that despite the Feds resolve to start buying bonds directly, it was time to get out (you can view those comments by putting TLT in the search engine at the top). At the time the TLT was at 103.75 and an initial target of 95 was suggested that could ultimately go to 83. Here we are today;
We are at 96.57, not quite to the line. That equates to about a 1% increase in yield and about $75000 per million. At this point, at least from a wave perspective there are too many possibilities to carve out a short term strategy. However, over the next few years rates are going up, not down. To understand what this means go to the PV calculator, http://www.moneychimp.com/calculator/present_value_calculator.htm and take the rate from say 3.30% to 4.30% on any fictive amount for 100 years. The value drops from 3890 to 1484, that is the head-wind that all “valuations “ are confronted with , regardless of what it is, the rent from an apartment, the value of an annuity, a perpetual preferred share, whatever.
OK, so us nervous Nellies should get out <$6.00 . As it happen it traded exactly at $6 this morning so you are presumable out; From 3.75/4.00 that is 50% so we chalk it up as 30%. By the way, I do think this stock could go to $9.75 and may buy it again if I can better assess how it goes.