Back in Nov. this looked like it was topping but there was still room from the big picture so we recommended putting in a stop-loss at $5.25, the stock then was at $6. We would now raise the stop to $6.25/$6.50. Both RSI and MACD are not confirming much further upside.
The other day they sold their aerostructures and industrial division for about $300 mln. This propelled the stock up, briefly , by 33% The other part of their business is making landing gear for aircraft. The chart is hard to interpret properly, perhaps above my pay grade , which is not hard considering I am not paid at all. Looking at the big chart, one might wonder why the low of 2009 is not it. After all a nice A-B-C could be considered done at that point. The problem with that is that the C leg has to be a 5-wave move. It isn’t. The first leg, into the 2003 low is unequivocally 3 waves. The second leg up into the 2007 high is clearly also a 3 wave affaire. So is the third leg down into the 2009 low. Three in a row does not make a flat, therefore we believe the correct count is A – a-b-c – C. The leg we are in presently, or may have completed, must then be sub-dividable in 5 separate waves which is not that hard to come by. Once complete – a 4-5 may still be required – the stock should then fall back to the levels of the previous two lows (2003 and 2009). We would sell.
Then (28 of Oct. 2011) and now;
These are the BRICs, Brazil, Russia, India and China. The prediction was for a peak in wave 2 at about $29, then straight down again. So far so good, we are only in the minor wave 4 of something; we may yet make it to about $20 for this round. Then we should go up in wave 2 of 1, only to drop like a rock after that.
The HXD is my preference but some people do not like the notion of going leveraged 2x. The idea of leverage seems to hit intelligence levels at very low IQs. RBCDS outlawed them some time ago and I understand CIBC WG is doing the same now. Here is a simple one, non-leveraged, for an alternative.
All of this is a little like gun control. There are a few places where there is virtually none. Switzerland is a good example. Most of the armed forces there are “reservists”, they get to take high powered guns home, yes home. Turkey has the 3d largest standing army, armed to the teeth, but also the highest level of gun ownership among the population. Nothing ever happens either in Switzerland or Turkey. Why is that? Simple because there is no substitute for freedom, freedom of choice, and experience. Both DS and WG want to save you from yourself, or, perhaps, they do not trust their own brokers!. But then again, it may not be their fault, the regulatory authorities should have gotten ahead of this one a long time ago and they did not.