Month: June 2012

FTP, Fortress Paper

Hamilton

Fortress paper makes speciality papers that are used as wallpaper but also for currency. One of their mills is located in the Swiss Alps, just a hundred kilometers from Zurich. They have made the paper for the Swiss Franc for years as sole supplier but do so also for many other countries’ currencies. What could be more appetizing than that? And if they are preparing to make drachmas, liras and perhaps even francs and marks they will not say. Here are the charts;

ftp june 2012 lftp june 2012 s

This stock did outperform gold briefly after the 2009 lows, going from $5 to about $62+. The Fibo ratio gave it away. It should come down in a large A-B-C and so far it has. C waves must be 5-waves so there is still one down-leg missing. At $25 overlap occurs which then would have to imply that a “diagonal” (wedge) is forming. These come in two varieties , expanding and contracting (both are shown). In the case of the expanding model the stock could trade to as high as $35 or so. Under the contracting variety not much above $26 should be expected. Take your pick.

BNS update

Hamilton

The expectation                                                   and the reality.

bns june 5 2012 sbns june 12 2012

The triangle is not the most elegant one but  it will do. Need to complete wave e and then a drop to about $49 should occur. There it might be a buy for $3 or $4, a short-term trade. At $49, if it gets there , wave 1 of 3 of C would be complete. If you do the short–term trade be sure to exit in a timely fashion as the next wave down is probable wave 3 of 3 of C which is when things usually get decidedly nasty.

Other possibilities do exist, for instance this 3 month down move could conceivable be a B-wave, to be followed by a C up, before we go straight down. That would add 4/5 months of agony and is certainly not the preferred scenario. A more likely alternative is that we are forming a B-wave triangle in an a-b-c wave 2, as wave 1 is already complete. The stock could then move up to $54 before dropping, this would only take a couple of weeks. For those interested here is a previous example of the same set of choices, this time with EWG and we chose the wrong option;

The expectation                                                  and the reality.

ewg s jan 2012EWG JUNE 12 2012

In the end the EWG is still going down but an opportunity is missed and a lot of time goes by. CAE is another example, see that blog.

SU, Suncor

Hamilton

SU June 2012

The last few weeks saw oil dropping rapidly. Looking, once again, at Suncor oil should go quite a bit lower, this despite the longer term outlook that we are running out of this stuff. Commodities are priced at the margin and consequently the long-term outlook has very little to do with what oil might do over the next few months or even years. Using Suncor we can reverse-engineer where oil should go. The chart is perfectly clear. First the big A leg down followed by the retracement which happens to be near an ideal 62%, clearly 3-waves. Then the stock does it again only at a smaller degree. This is wave 1 of C. It too is followed by a 3-wave retracement of about 62%. Now THE major rule of EW is that 5-wave moves are in the  prevailing direction of the trend, and 3-wave moves in the opposite direction (counter-trend) Ergo the trend is down (even if the actual count is incorrect!) Both a-b-c’s are as plain as daylight. How exactly C will develop is a different matter altogether, but down to $17 or so is a good initial guess as that is where C equals about 62% of A.

(see also previous SU blogs).

WPT update

Hamilton

wpt june 11 2012

This is it as far as I am concerned. You could have made almost $8 on $25, all you needed was patience which I certainly do not have. Today’s high of $32.60 is just 10 cents above the top of the suggested range. That is at least 7/25 or 28% in less than a month.