The opinions expressed on this page are those of your editor,
John Budden, and
not those of our Friends or Legends (living or dead); unless
specifically stated.
We are working on our ability to communicate
with our immortal Legends and will keep you informed on
any ‘break through’.
At BeEarly.com we are fortunate to have my old friend Ron Meisels
as our visiting professor of technical analysis. Ron
uses his technical expertise to identify great
Canadian situations.
Ron has kindly given us permission to provide you with
some of his recommendations from time to time.
To receive his complete technical advice on market
trends and North American companies, I recommend that you subscribe to
the NA Marketletter. Please visit http://www.na-marketletter.com
and at least, try a free one month subscription. NA Marketletter
is a bargain that will help you thrive and survive in the challenging period
that lies ahead.
It is usual, near the end of a bull market, to label
sell-offs (which are actually warning signals) as a
“non-event” or even a “buying opportunity”. This is what
occurred on Tuesday. Not a negative comment anywhere,
despite a 178 point decline in Toronto.
Admittedly, this was a mere +1.3% drop, but it brought
the TSE Index below its June 8th lows and below its now
flattening 50-day moving average.
These signals are very negative for the
intermediate-term as they could herald further declines
toward the S&P 500 1,465, the DJI 12,900 and the TSX
13,300 areas.
At the same time, the decline has created a short-term
oversold condition, which may lead to a rally toward
(but not to) the recent highs.
We will use any and all such rallies to close out many
of the positions on our Buy & Sell list.
June 26, 2007:
THE BULLS ARE COMING,
THE BULLS ARE COMING or,
To paraphrase Mr. Churchill: “THIS IS NOT THE END,
BUT IT IS, PERHAPS, THE BEGINNING OF THE END
We have been persistently bullish since October 21,
2002. There were not many bulls then, but the group grew
as the market advanced. There were individual hold-outs
along the way – those who consistently questioned the
strength of this Bull Market. In our personal
presentations we often joked that when these
market-letter writers or economists finally “threw in
the towel”, and when ads appeared looking for salesmen,
would be the time to seriously consider a more
pronounced down-leg (or bear) in the markets.
We just heard that two of the most stubborn hold-outs
have now changed their opinions. Mr. Richard Russell,
who relies on the least effective technical signal
called the Dow Theory, now sees a multi-year bull market
in the offing; and a certain well-known Montreal
economist (see Globe & Mail) has also aborted his
bearish stance. Maybe it is not fair to single them out,
or even use the term “the bulls are coming”, but the
message is clear. Add to this the low percentage of
bearish market-letter writers, the increase in M&A
activity, and the quarter-page ad by one of Canada’s
prominent brokerage firm in yesterday’s National Post,
who, for the first time since 2000(!), are looking to
hire Investment Advisors!
To put it in proper perspective, let us emphasize that
this is not the end. It usually takes some time to form
a top. The markets could go higher in the near-term
(Market Comment #113). However, now that the bears have
“thrown in the towel”, now that all of our targets have
been reached, now that we are aware of the “Seven-year
Itch” (Market Comment #108), we should prepare for the
dreaded triple “SH” (better known as “SH” cubed): a
short, sharp shock, the probability of which to occur
will grow as autumn approaches.
We are not forecasting a longer-term problem; only the
end of the current cycle. Come November, we expect to
see bargains and another period of positive market
action in 2008. However, we though it our job to give a
notice to those among you that need a longer time to
build up reserves.
To listen to
John Budden's Business@Night
interview with Ron Meisels on August 29,
2006
Ron Meisels - President of P & C Holdings
Ron is
President of P&C Holdings and a main contributor to
the NA Marketletter which can be accessed on the web
at www.na-marketletter.com. Ron has been ranked
among the top three technical analysts by Canadian
Institutions for six consecutive years and is the
first Canadian recipient of the A.J. Frost Award for
his outstanding contribution to the development of
Technical Analysis.
In our previous report on
Inco (January 27, 2005 - $40.00)
we suggested a target of C$59.
Following our report the stock
rallied to C$53.84 in March (A),
pulled back to C$42.29 in May
(B) and then settled into the
lower part of a rising parallel
channel (see dotted lines –
right chart).
Inco’s recent price action
(C) was a breakout to a new
all-time high level and suggests
a move toward the top of the
channel.
Technical indicators confirm
the bullish status: the 40-week
moving average is trending
higher, the VSI shows positive
momentum and the MACD is rising
(see lower panel). Only a
decline below C$52 or US$43
would suggest a delay in the
bullish potential.
Point & Figure measurements
provide targets of US$59 and
US$69; and C$67 and C$79 (an
approx. 20% & 40% appreciation
potentials from current levels).
Higher targets are also visible.
Research in Motion is on
the verge of a major breakdown.
Research in Motion rallied
steadily from $7.92 in March
2003 to above $115.00 in
November 2004 (A-B). Following
this ascent, the stock settled
into a triangle formation (see
dashed lines) but has recently
started showing negative
technical signals:
The price fell below
the triangle pattern to
$77.00 (C);
The 40-week moving
average is trending
downward;
The MACD is falling
(see lower panel).
Only a move above $92 would
reverse the negative status of
this stock.
Point & Figure
measurements provide a target of
$65 (a 16% depreciation risk
from current levels).
August 20, 2005
An Important
Update ... From Ron Meisel's NA Marketletter
Our friend Ron is absolutely the best technical 'guide
dog' for investors who want to profit in the Canadian
securities.
Please visit
http://www.na-marketletter.com
and at least, try a free one month subscription.
The Point & Figure chart suggests that
the stock continues to trade below a
very negative long-term descending
trend-line, which currently intersects at
about $7.00. In addition, there has been
very little base-building.
At the same time, given the market’s
bullish behavior and the investors’ constant
search for "bargains", Nortel has been
making some headway.
Current Technical Outlook –
Nortel may continue its recent more positive
behavior and may rally towards the
$5.00 area. However, it is likely to run
into heavy resistance (supply) at this
level.
Those with a short-term horizon could
consider looking for trading opportunity,
but do it with the greatest of care.
June 29, 2005
Ron Meisels will be a guest on "Market Call Tonight"
on ROBtv, on Friday, July 29th, at 7:45 PM ET.
June 9, 2005...
ALERT
Compliments of good friend Ron Meisels of the NA Marketletter
who is our technical legend.
In your editor's opinion this is a very timely
alert...
The corrective storm shook the gold sector to its bone.
Those who bought at the top, back in 2003, have already
sold in disappointment and despair. Those who kept
buying gold stocks all the way down to the bottom have
already left. The rest argue that there is no tomorrow
for gold and gold stocks.
In our previous report on Husky Energy
(October 24, 2003 - $21.65) we suggested
targets of $25 and $29. Following our
report, the stock rallied to $28.30 (A), had
a pullback toward its rising 40-week moving
average (B) and most recently, reached a
high of $43.87 (C) for a 103% appreciation
since our previous report and 157%
appreciation since our first report (March
11, 2003 - $17.05).
Technical indicators including the VSI
and the MACD are positive (see lower panel).
Only a decline below $37 would reverse the
positive status of this stock.
Point & Figure measurements provide
targets of $49 and $54 (13% and 24%
appreciation potentials from current
levels). Higher targets are also visible.
AUR
RESOURCES INC.is a mining company which has
interests in and operates the Louvicourt mine, the
Andacollo mine and the Quebrada Blanca mine.
FINNING
INTERNATIONAL INC.sells, rents, finances and
provides customer support services for Caterpillar
equipment and engines, and complementary equipment in
Western Canada, the United Kingdom and South America
(Argentina, Bolivia, Chile and Uruguay).
METHANEX CORPORATIONis engaged in the
production and marketing of methanol.
