Year: 2016

STN, Stantec

Hamilton

stn jan 24 2016

You do have to look at a more detailed chart (not shown) to determine what happened the past two years, an a-b-c irregular wave 4 followed by a very clear wedge wave 5. This stock topped last year. If you do not look at the detail you may misjudge the situation in thinking that you just finished a wave four and still have 5 to go up. That is not the case. Often wave 1 is less pronounced or slips out of sight but it is definitely there in this case.

Expect a drop to the wave 4 level of previous degree and or 61% decline, more or less as drawn.

RDS.B a buy and CVX

Hamilton

rds.b jan 10 2016 bRDS.b jan 22 2016

We repeat the old chart from Jan 10, 2016.  At the time, roughly 10 days ago, we stated that we would prefer to see the stock drop below the low of the A wave. It got to $35.95 yesterday so that does the trick for now. One can never know for sure but even if one more move down were to occur, the rebound minimum target would still be at about $56 or so. Therefore this is a low risk entry point. CVX, Chevron already has a first wave up which has recently corrected about half way. The next leg up, regardless of whether or not it is in a correction , should take it much higher, closer to $110.

The count for CVX is probably different from RDS.B’s but the immediate buy opportunity is similar;

cvx jan 22 2016

The big question now is the spurt up today due to yesterday’s roll-over of the future contract from Feb. to March , or Mario Draghi’s ramblings about there being no limits to what they can do and similar talk in Davos, or neither, just the waves.

OIL

Hamilton

oil jan 20 2016

Unlike the Bank of Canada we have no idea how low oil might  go. Not too long ago they had no idea but now, all of a sudden they are confident it will trade at about $36 on average for the remainder of 2016. At least we have been pretty accurate with our predictions.

Where we are now it is hard to fathom . All we do know is that the 4th of previous degree, not that long ago in 1998 or so, is around $11. Furthermore the 5th wave in commodities unlike equities is often the longest. On top of that we still are of the opinion that a 4 and 5 are still required. In short, do not believe anything you hear on TV from experts that never dreamed that oil could  possible go below $80 or so.

Wave 5 would be equal to 3 at about $25. After that there is little else than that 4th wave of previous degree at $11 to guide us.

Tonight the futures roll-over with the front month becoming March instead of February. Due to contango, there will be a price increase of about a dollar due to the downward slope.

IBM update

Hamilton

ibm jan 20 2016

We have a particular interest in IBM, simple because some investors still consider this stock to be a blue chip. You cannot go wrong with this one as you are always in good company and these guys where 3-piece pin striped suits. Moreover this stock has always behaved a little out of phase, time-wise, with the rest of the market so it offers some diversification (which we don’t care for but the market does).

The top was in now 3 years ago. It was at $201 but elsewhere I found numbers more like $212. In any event this stock is now down by almost 50%. If this is a mid-point, and that fite the most plausible count you could easily go another $70 or so , bringing the stock to something like $50/60 and it could be even lower.