Month: April 2011

MAT, Mattel Inc.

Hamilton

mat b mat

Among other things , Mattel makes the Barbie doll which is a must apparently for any girl in North America.  She, the doll that is, broke up with Ken many, many years ago but recently Ken was reincarnated and they are back together. Not a bad marketing ploy but the question now is how long it will last. By the looks of the chart , not very long. The stock has essentially been in a 10+ year corrective mode, tracing out a fairly clear A-B-C.

The 2 year chart has two very distinct triangle formations in it, likely in the wave 4 and 4 of 5 positions. this pretty well guarantees a sizable pull back is just around the corner.

TCK.B Teck Resources Ltd.

Hamilton

On Jan 15 we thought this stock had peaked at $65 and should be sold, here are updated charts;

tck apr 2011 tck apr 2011b

We still are of the opinion that the last move up was NOT a 5th wave but a B-wave instead. This fits much better with a whole lot of other stocks (see also FM). The implications are not much different either way, except that the downside target may be a bit  lower than in the case of a triangle (rather unlikely)

tck apr 2011 sm .

In the mean time the stock has dropped almost $20 ( 30%) in what would be a first wave. After that it may have completed an a-b-c or perhaps only the a-b part with c still to go. By the time wave 3 is done the stock should be close to $30.

CFP, Canfor

Hamilton

cfp cfp s

Canfor has an interesting chart; it tells you virtually nothing  except that for the past 25 years or so every single wave or leg has consisted of 3 separate parts , defining them as corrective even though it is not quite clear what it is that is being corrected.If we do what all brokers do, that is simple extrapolate linearly while looking over ones shoulder to make sure that the herd is going in the same direction, this stock should have another  3 wave coming.

Perhaps, in any case the stock was at the upper trend-line, a good spot to sell. Also, over the past 25 years it has been higher for only two and a bit and then not by much. So perhaps it is well priced.

UN, Unilever the Dutch/Anglo conglomerate

Hamilton

Much of what goes into soap also goes into margarine, that is how the English (soap) and Dutch (margarine) decided to work together back in 1930 More recently the company was also working together with Proctor and Gamble which earned it a Euro 300+ million fine for running a cartel. It has also come into the spotlight for doing away with it’s defined benefit plan, long held out as a model. This is a big company, with a P/E at about 17 and earning a dividend of about 3.5%. The revenues are around 50 bln. a year. Employment , as with so many large companies, has been dropping steadily;

UN emp

I show this simple because so many of us still believe the myth that large companies create jobs, for the most part they actually do the opposite. In any case here is the chart for UN;

UN L

Very nice 5 waves up, and a well defined triangle in the wave 4 position (it has to be!) followed by a thrust up of the appropriate size, staying precisely within the channel boundaries. It then drops almost 62% and the question now is if that was all there is or is there more to complete the correction and make it a bit more complex?

UN corr

From the lows of March 09, the move is simple too bullish to be a new bull! and there is no way to count it as one. Also the initial A-B-C or 5 wave down should be followed by at least one other such leg so our educated guess is that the stock is doing a fairly large flat (which fits better with an initial A-B-C down!). We are now in the B wave up which itself is an a-b-c. This leg needs to make a higher high, that is above $33 to complete which could happen in the next few days. It may continue to about $36 where the c leg relates to the a leg by a very common 0.618. This could all be wrong , in which case the stock would probable go to the upper trend-line which is ONLY $4 higher at about $40

This analysis jives very well with that for Colgate Palmolive (CL) , see elsewhere in this blog. On balance this is a sell in the next few weeks at somewhere between $33 and $36, you risk a few dollars on the upside but avoid the potential of losing $20+ on the downside.