See no hands, no EW either. Just plain luck hitting the top within weeks and now we are down about 25%. A buying opportunity? Definitely not, not untill you get into the regression-to-the-mean zone, the pinkish bar, at about $45. That is another 50% drop. At least you do not own Viacom (VIAB), that did this in a mere 5 days starting from two thirds as high.
In 2012 this stock looked ripe for a drop. All the others did but not this one, which is plain to see from the relative performances.
So Agrium did not behave as expected and went on up for about three years, making a new high in early 2015. This move from the 2009 lows is messy and has a lot of overlap, but if you break it down you have two distinct, almost equal, legs up. In the middle there is a pause which has all the characteristics of a running correction. The whole thing is quite symmetrical which is why we prefer the B-wave scenario to that of a 5th wave. Both, by the way, would have the same target around $25, by they would differ in how you get there. (a single 5 wave sequence or an a-b-c ).
Ultimately AGU should join the others once again somewhere near the 2006 levels. This would make an interesting pairs trade, long 5 POT(or MOS) against short one AGU.
The usual, then June 6, then Jan 4 and now charts;
We only have a dollar or two to go and we will be at out target. You can enlarge the charts by clicking on them. When we get there this stock will be down by 2/3. This in the face of fuel prices dropping which should have given the company more lift. Where it goes from there remains to be seen. It should be a buy for a trade of few dollars, which on a percentage basis would be quite large. Thereafter my guess is as good as yours. Just remember there are other stocks, move to one with a clear pattern. This “diagonal” is one of the best and reliable. See also ABX for the expanding version.
To add a little insight to our recent blog on Magna, MG, and noting that Tesla is down almost 50% (more than $14 today alone) we thought we should have a look at BWA. They make, among other things, transmissions without which no car can drive, except ironically perhaps, electric cars. (Electric motors have a more linear torque curve than gasoline engines.) The last $20 drop in BWA is almost a straight line suggesting that it is a third wave of something. That would not bode well for the future $25/$18/$8 are successive possible targets even though a bounce somewhere around here should be expected given the RSI and MACD. $26.25 may offer some resistance.