Then was the 27th of January of 2011, so about seven months ago. Here is that chart;

At the time, see the blog, we made it clear that this might well be it. The count was clearly that of a large B-wave that had completed every minute detail. As always, the initial target was the level of the b-wave within the larger B-wave, roughly $45/$46. Here is today’s chart;

As it happens EW nailed the high almost to the day at around $69. It also had the correct initial target to the dollar. This was a drop of no less than 42%, there were no analyst that I am aware of that were even remotely aware of this possibility. Anyway, now we are back up almost to $60, a 50% increase from the lows and a retracement of about 70 % of the drop this year. Also the stock is very close to the 4th wave of previous degree. If you did not sell the first time, you should do so now.

This stock was split out of the larger CP conglomerate, the rails , hotels and shipping group started their own lives in 2001. Consequently there is no chart preceding that time for the individual components. Here is what we have.

On the left, a model, text-book EW, clear as a bell and consequently more “predictive”. This is an EWaver’s dream come true. We have an initial 5 wave sequence up into the top during which the stock roughly goes from $20 to $90, a bull market by most accounts. Then the stock gets decimated in a clear A-B-C, losing 2/3 of its value. Then comes the correction of that drop and so far we may have all of it or only half. One would expect 62% for starters and perhaps to the B wave level , $6 higher. Given the very clear wedge, the equal vertical distance between C and A and the rolling over of both the RSI and MACD this should be good enough.

One could wait another 6 months and hope the stock reaches $75, and, of course, it is always possible that this analysis is wrong (we may, for instance,  be at the start of a new bull market and we are looking at a series of 1-2s that will soon explode to the upside). Perhaps, but not likely.

See previous  (Sept, 2010) blog below;

CP dropped from $90 to $30 in a couple of years , pretty well 2/3  of its value. Now that all the worlds financial problems have been resolved the stock is back up to $65 or so, a clean double plus. Perhaps the stock will go (a lot) higher yet BUT the move from the lows over the past year or two look to me like a near perfect wedge, the signature of a correction gone too far. Looking at the big picture it would appear that the stock dropped in a nice A-B-C, which could be all there is. However, it is also possible that the entire A-B-C is just wave A of a much larger correction!  I do not have the answer but from a risk/reward point of view the stock is up $35 with  – perhaps – another $10 ahead but could drop any moment t0 about $50/$45. A sell.