CL

CL update and IBM

Hamilton

cl july 2011

Colgate, as discussed before looks like it is topping in a 5th wave wedge. This it has in common with IBM;

IBM jul 2011 a 

Whereas CL has a contracting diagonal (wedge) IBM has an expanding one. IBM when we still knew what business it was in, experienced a 25 year period during which the stock traded down. That 25 year pattern could possible be a “megaphone” which would , by necessity make it a wave 4. Even then the stock is topping;

IBM july 2011 log

Typically the stock does not trade much above the upper boundary of the “megaphone”, which is about where the stock is now. A sell however you slice it.

CL, Colgate getting there.

Hamilton

Then                                                                   and    now ;

cl may 2011s cl june 2011 2

Now that we have a little more detail it is starting to look like the ultimate target is about $92. Presently the stock is at about $89 and change , so another $3 to go. On the options that should reduce the price by about $1.50 to $5.70 bid/$6.70 ask, approximately where we anticipated it to be a while ago;

CL options june

Once again I do not for a moment pretend that this is the option that one should chose; all choices throughout the range of strike and time should be priced accordingly.