TSX

TSX update

Hamilton

TSX apr 2 2012

We are of the opinion that the TSX is already cooked. The EW count that best fits the action over the past 5 days fully supports this view, at least for now. There was a clear 5 wave drop of about 400 points followed by a 3-wave rebound that has retraced 85%, so far. Today , of course, there is again bullish news, this time ISM numbers from China. Did not know they existed but there you go. Also the Eurozone has the highest unemployment rates since x, again very bullish as this will help a European QE whatever get launched etc. etc. In any case if the TSX stays under 12600 we could possible have a start for the bear.

TSX update

Hamilton

TSX feb 22 2012

Just a quick update for the TSX. The TSX hit an interim high late October last year at about 12500. From that point in time it has spent 4 agonizing months seemingly going up everyday on Greece’s yes-no default comedy which is now getting the icing on the cake by way of the rather innocent sounding retroactive “collective action clause” which is essentially no different than the, in maritime circles, well accepted “general average” law. Over these four months the TSX has gained a grand total of 200 points and now sits just above the 62%. It has gone up in a  fairly clear a-b-c in which the c-wave is a wedge or rising flag. It could be complete or add a little more to get to the wave 4 of previous degree level to finish wave 2. Then wave 3 down should start. On this index there is no compelling reason to change the outlook!

DOW, DAX, SPX, NYA , STOX600, TSX, DJT

Hamilton

indu feb8 2012

The DOW has clearly exceeded its May 2 high of 12876 by about 50+ points. This would normally negate the count, that is the one where this was wave 1 down followed by an a-b-c correction/rebound. I simple do not know what to do with this! The structure is just fine, only it should not have gone this high. EW is supposed to work when markets work, that is when there are a multitude of participants who freely make up their minds to buy or sell. Perhaps this precondition is no longer met now that CB’s have thrown in 15 trillion into the punch-bowl (1/3 of the value of world equities!), never mind all the other “stimulating” factors. I just do not understand but at the same time will not get religious or dogmatic about it. Other than the Nasdaq, which is in a completely different phase, just about every other major index has NOT negated this count, so for the time being we will stick with it. Below are some examples;

DAX feb 9 2012SPX feb 9 2012NYA feb 9 2012

stox600 feb 9 2012TSX feb 9 2012DJT

You can click on them to enlarge. Un till such time that a few more of these “negate” the count I will take the catholic approach and simple nullify this one  single incident.

MS Morgan Stanley, SI Siemens and the TSX

Hamilton

MS according to the charts could be forming a triangle. Here is an update;

ms dec 22 2011

We are following this with a little more interest than usual, having missed the opportunity to buy at $12. At the risk of boring the reader, I have done a little math just to test the validity of this being a triangle. Wave c relates to a by a factor of 0.652 and d to b by a factor of 0.748. Not ideal but close enough not to reject the notion of a triangle. Wave e now may not exceed c at $17.50, but also does not have to be contained by the triangle’s boundaries. The ideal level for e would be at $16.89. All this is mostly academic as you should not trade on it. But if it does all this, and it is a big if, then it will be a screaming buy at just under $10 where it would hit the upper channel line as support. $10 is also what was paid for Bear Sterns by JP Morgan. It is unthinkable that it would not pay that sum again for it’s own, far more distinguished, offspring now that it has been orphaned by it’s other parent, Glass-Steagall.

There are many other stocks that have a triangle forming, at least the possibility for one, Siemens (SI) and the TSX are possible examples;

si dec 22 2011tsx dec 22 2011

Both are presently in their respective e-waves, and whether or not they are actually forming triangles is perhaps less important than the fact that they have been going sideways for 5 months. Consolidation patterns are invariable resolved in the same direction in which you entered them, in this case down.