Month: March 2015

CAC update

Hamilton

cac march 6 2015 bcac march 6 2015 s

These are semi-log scale charts which compress the most recent spurt up when compared tp an arithmetic chart. The count is not the only possibility. Wave 4 may have simple ended in Oct. of 2014 with a simple a-b-c (three-wave) structure after that to complete the entire thing. The index is now trading at the top of its (pink) channel  and the previous (blue) channel for wave 3 has become resistance.

The fact that this top is occurring concurrently with other tops, most specifically Nasdaq’s 15 year round trip AND at a time when unemployment is running supposedly at 5.5% (just 1% above what used to be considered full employment!), suggests that this may , at last, be it.

Given the above our advice from here on is that you only buy stocks that go up in value. We realize that this may crimp one’s “style” a little but it is a lot safer.

SNC update

Hamilton

snc mar 5 2015 bsnc mar 5 2015

See also our previous blog on SNC. In the big picture we are now wondering if a triangle wave 4 is in the making. This would be very bullish so we are only wondering but nevertheless, given another small triangle that the stock just sort of dropped out, it seems quite possible that this stock would, before doing anything else, rebound to that $45 level. As far as we can tell this thrust has the right size and structure so it may be done. To play it safe -  not always the smartest thing to do – you may want to watch it drop closer to $32.80.

Some people believe this stock may be overdone to the downside. There is this boyish looking Maxim , head of research at Dundee, who is very intelligent and articulate and does suggest it is overdone. I believe his target is around $50 or so.

CSIQ, Canadian Solar (on Nasd.), FSLR

Hamilton

csiq 5 mar 2015

Together with two other solar stocks we recommended selling this one back in March 6, 2014, pretty well a year ago to the date. It was at $41 at the time. Then just last month it hit the 62% retracement mark and had completed a textbook correction. WE were asleep on this one but did recommend buying FSLR, more on that later.

The beauty of EW, unlike nuclear physics, you do not need to understand the whole thing, all you need to do in many cases is recognize the last pattern for what it is. In this case a completed correction!. You also know that after a completed correction the stock must go up, most often to the level of the b-wave in the correction. In this case that is at about $40. That is quite a bit so you may not want to take the risk, then just assume that you will get a minimum of 38% of the drop or about $10 (which, by the way, amounts to a 50% return in a single month!)

So we looked at FSLR instead. Here is the chart;

fslr mar 6 2015

Also please look at the previous blog that explains the present position much better. Here too we were asleep at the switch letting the first $9 slip by, but still we are up $12 on $49 which is 25% in less than a month. We are optimistic that this stock has a lot further to go but for the moment it is a little overbought looking at the RSI. But then the b-wave is at $72.