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Registered User
Joined: 12/19/2004
Posts: 457
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Here are some stocks I've been following that look like they are due for a significant fall:
1. Catipillar (CAT): This Dow component has been on a tear since the 2003 bottom.
The monthly chart suggests to me this is near a complete 5 wave advance from the 2003 lows, as well as a 5 wave advance from the 1985 lows!
The weekly momentum indicators I use are overbought and forming a negative divergence. The divergence is much clearer on the daily, and the price pattern appears to be making a Head and Shoulder top. This could get ugly on a breakdown below 70.
2. Meridian Biosciences (VIVO). Has been in a strong uptrend since 2001. The monthly wave pattern isn't clear, although you could make the argument this has completed wave 5 or wave 3. Regardless, that would suggest a correction of some significance.
The weekly is a bit clearer, in that momentum has clearly negatively diverged from price, and the most recent price peak has occured on low volume. It could be forming a double top, or a Head and Shoulder top. The recent high formed a candle reversal pattern, where I would have expected a rally on weakening momentum to fail.
3. Haliburton (HAL). The monthly chart shows a negative momentum divergence, along with a potential Head and Shoulder top.
The near term appears bullish. Volume has been strong at each major price peak, so there doesn't seem to be a lack of interest at higher prices. It is probably safe to hold here, and set some above market sell targets higher than the $80 level. Although anything is possible, I don't expect a sell off until sometime in late summer.
4. Newmont Mining (NEM). Despite my bullishness on gold, Newmont appears to be one of the big mining companies that will lag. The monthly shows a negative divergence, while the monthly charts suggest a 5 wave advance from the 2000 lows is nearing completion. I do believe this will make it over 60 in the comming months, but anyone looking to play the gold market should probably consider Goldcorp, or Glamis.
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Registered User
Joined: 12/23/2005
Posts: 41
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Can we add FFIV and NUE to it??
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Registered User
Joined: 12/23/2005
Posts: 41
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nice five points in FFIV so far !!!
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Registered User
Joined: 12/19/2004
Posts: 457
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Good call on FFIV. I'm looking for a pullback of some sort to get short.
NUE still looks too strong to be short, although a fundamental POV I'd agree with you if the economy slows (as I'm expecting).
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Registered User
Joined: 4/7/2006
Posts: 10
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Might add SEB to that list.
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Registered User
Joined: 4/7/2006
Posts: 10
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Might add LUK to that list. Real Heady.
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Registered User
Joined: 4/7/2006
Posts: 10
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Looks lik NHY is headed due south.
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