Year: 2009

TLT (Long bond ETF) May1

Hamilton

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;

tlt may1 

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.

F May 1

Hamilton

F may 1

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.

IMN Inmet Mining , May 1 ( by request)

Hamilton

imn 2 may 1

I do not like the “on request” approach as more often than not you are forced into an opinion, which is antithetical to the E-wave approach which is preeminently opportunistic in that there are thousands of stocks so why bother with the vast majority where the pattern is not clear. Anyway here is a shot at it. Back in ‘89 my broker then proposed I buy this stock or Magna. I chose Inmet, a very big mistake then and as in the cat and the hot stove, I have never looked at this stock again. Lets look at what is obvious; one would have had to be a complete moron not to have sold this stock at say $75 or above. When it was at $105 one would apply the “normal” 50/61% target (Gartman’s box) which brings you to about $45 or so. Ergo anyone owning this should be up, or wt worst, about flat right now. So what next, here is the chart in detail.

imn may1  Looking at this structure from $105 to $14 it clearly has had its own bear market, this is not to say that it cannot go lower but there is no compelling reason to assume that, so ignore the green and look at the purple. You are, right now hitting the trendline and you have completed what could be a 5-wave up, complete or not. Both suggest a drop back to $30/$25 before you move much higher, a tradable move. My guess is that we will go sideways for a while. Copper itself is already taking a break, see below (log-scale!). By the way, I do not for a moment believe in the “China” story. In Mongolia there is enough of this stuff for a few hundred years ( see IVN)

Copper May 1

EK Kodak, for the brave only. April 30

Hamilton

EK April 30

This one is different from all the others,; it also makes a low around March 6/9 but then turns back down. We have a nice initial 5 waves from $2 to $4.5 and then we retrace about 60% going back to $3. The next move should (at worst) be a c to $5.5 or a 3-4-5 to whatever; the trend-line and the 4th of previous degree are both at about $8. This stock was above $90 in ‘98 and presently has shorts to the tune of 30,500,000 shares or about 11% of the float. The RSI is close to being oversold. This is a double or nothing proposition except that the nothing part usually does not happen all at once (it will stop at a dollar and rebound as these things tend to do).