FN.un, First National Financial Income Fund

When I wrote about Home Capital Group the other day a friend of mine reminded me that there are others in this broad field of mortgage financing, specifically FN.un. This is quite a mouthful and it is not the old Franco Nevada gone income trust, nor is it the Canadian branch of First National Citibank. It is a company that makes its living securitizing residential and commercial mortgages through operating company that is created as a limited partnership.  The holding company did its IPO in 2006 at $10. This is a pretty complicated outfit so I give the website for further detail, www.firstnational.ca . Here is the chart;

fn.un fn.un 2

The stock jumped up and down between $22 and $8, the second top actually exceeds the first but for all intents and purposes this is a double top ( a good place to sell). From EW perspective, if the second top is the “real or orthodox” top then a drop to the 4th wave of previous degree should be anticipated, that is to $8. If the first top is the real top then the move back to $22 from $8 is probable a B-wave, in which case the whole thing should become a “flat” A-B- implying that the next big move is back down to $8. All this is, of course, tentative but , considering that we started the process back down with a very clean and distinct 5-wave structure, this may turn out to be the correct interpretation.