GWO

GWO update

Hamilton

The usual then, July 2013, and now charts;

gwo july 5 2013gwo aug 30 2015

For some inexplicable reason we were anticipating a high of about $35. This is neither the double-top level, or the point where c is equal to a of the B wave. The logical target would have been about $37.The actual top of the B-wave was at $37.70. Aside from that the pattern was correct all though , at the time, it would seem rather unreasonable to have expected this to take another two years and a month.

The drop does not look like much but it is almost 20%. Also it erased all the progress of the past two years in little over a month. The channel is broken and we think the trek down to below $10 has started. This was the best performing insurer so the others will , no doubt, follow suite. If you did nothing over the past two years, now is the time to sell. However , do not forget that this blog never, ever, gives investment advice, only discusses EW. Talk to your broker for that solid advice that you can lean on and trust! See detail below;

gwo aug 30 2015 s

GWO, Great West Life update, 30 year US bond.

Hamilton

gwo july 5 2013$UST30Y july 5 2013

We were wrong on GWO and also MFC, primarily because of the time this correction has taken. We are now in the 5th year, more than twice the time it took from top to bottom. In the meantime the notion that higher interest rate are good for insurers has been universally accepted propelling these stocks higher faster than the other “financials”. But, in at least the case of GWO, the pattern is becoming clearer and clearer. This is a B-wave that is fairly close to completion. It could be complete as is but it could also continue for a few more months to do a more articulate 4 and 5. $35 would be a maximum target. Bond interest rates are rising quite dramatically but it is not yet clear that they will continue.  Sell before the C wave starts.

SLF, Sunlife update, GWO and MFC

Hamilton

See also previous blogs!

slf dec 1 2012 bslf dec 1 2011

Between $25 and $27 there is some overlap between waves 4 and 1, which normally should not happen. Otherwise the stock traded precisely as anticipated. However, the exception is the “diagonal”, in this case an expanding one where this sort of overlap is not only allowed but quite usual. The diagonal is shown in beige in the big chart. Also shown (in grey) is the entire A-B-C structure within which the C wave is expected to equal the A (roughly) as a vector. A new low ultimately is required but it does not have to go all the way to the  trend line, if more time is spent on getting there. So when you put it all together there are a good number of reasons to get out now if you did not do so at the earlier recommended level of $25.

1. The stock traded back to the 4th wave of previous degree.

2. The short term (1 year +) A-B-C is near perfect in symmetry and magnitude.

3. The big A-B-C is a very plausible expectation.

4. The RSI (and to a lesser extent the MACD) are not confirming the present stock value.

5. The supposed problem of low interest rates will not be solved soon.

6. The p/e ratio for this stock sits at 28, double the “normal” level.

7. This blog has called this stock quite accurately; maybe luck will continue.

Time to get out or carry a stop-loss just below the present level.

Great West Life and Manulife also have plausible wave counts to the downside. GWO is the healthiest of the three and MFC the sickest. GWO is also sporting an expanding diagonal or perhaps a triangle, whereas MFC appears to have a contracting diagonal (wedge).

GWO dec 2012MFC dec 2012