Month: November 2010

SC, Shoppers.

Hamilton

See also Aug. 23 and Sept 21 comments.  Nothing much has changed since then but nevertheless I am inclined to favor the bullish possibilities at this juncture, however with the caveat that I stop out $2 below the purchase price!

SC nov 2010 Sc nov 2010 2

The idea that we were just in a 4th wave and should make new lows is still a distinct possibility, but the action over the past month or two looks corrective ( counter-trend) which strongly suggest we go higher and if we do the $45 target (top of e in a triangle) should be attainable. Of course the b=wave in the triangle looks a lot like a 5-wave move which technically negates the existence of a triangle, but the behavior of the stock can still follow the script. The reward is OK but nothing to write home about so use a stop close to the purchase price! By the way, the idea of this being a 4th wave in a new uptrend is essentially negated by the size of this move over the past two months or so, and by the overlap.

HXU and HXD, 2x up or down the TSX

Hamilton

These leveraged  Horizons Betapro  vehicles are fairly simple, you do not lose on futures roll-overs as no futures are used and consequently you do not suffer the debilitating effects of a commodity in contango (such as in HNU).  They are straight vanilla no nonsense tools that go 2x as fast as the underlying TSX. There are many of these, Google ‘direxion’ and at least 2 dozen come up that are leveraged up to 3x.

I like to look at both the up and the down as they should mirror each other and, if done correctly one can theoretically make a living just alternating between the two. Here they are;

HXU Nov 2010 HXD nov 2010

Before being let go at RBC (I am being polite) I had every single client of mine with a standing order to buy HXU at $8. They would have doubled their money. At the 62% retracement the HXD should have been bought. It is difficult to get it exactly right but the beauty is that even if the market runs against you, the sensitivity is quite low, whereas if it goes your way it really goes. It could well be that the market has another leg up , but if you are convinced that there will be a bigger one down, either now or later, this is an ideal investment if used in moderation. The SDS does the same for the US S&P (in US$) or as HSD (in Can $). Remember that you are not trying to catch the 30% movement, instead you are aiming for at least 100%

F, update from Aug 26.

Hamilton

f aug 26 2010 F Nov 2010

On the left is the chart from August 27th with the green pattern as the most “’elegant” possibility. This based on the EW probability of corrective waves returning to the 4th wave of previous degree, seen here in a big chart picture.

F bigchart 2010

The count is probable incorrect as there is likely a 4-5,4-5 series at the end but that does not matter here. $17 (or so) is the ideal target. The actual high was $17.42, a little above the $17 I mentioned as the max.This is possible if a triangle did occur! I suspect the stock is rising in sympathy with the GM IPO but the why of it is not entirely clear. There was a little gap just above $15 and both the RSI and MACD are turning. I would definitely stand aside here and brood on why I had not bought a truckload of this stuff.       Click on charts to enlarge and move them around.