Jamiee – Here’s a different take on NCM. We know that stock...

Jamiee – Here’s a different take on NCM. We know that stock patterns often repeat and if you look at the monthly chart below (top chart - lower chart is weekly) the numbers show what I see as the Elliott Wave count. Notice the similarities between the early cycle and the current one. If correct then price is likely to continue falling away in the medium term (as you say it could rise in the short term). I also acknowledge the second cycle the point labelled 5 could be a 3 – in which case I’d expect price to rise in the medium term. Now I’m not having a bet both ways – I’m saying my reading is that it will fall further but (as always) there is an alternative view.

Secondly, price is in a formal downtrend on the weekly chart and I try not buy in a downtrend (or I need to have a really good reason).

So while there are always short term rallies in downtrends (and all downtrends turn into uptrends at some point), those rallies are usually more restrained in downtrends because they are swimming against the tide.

I’m a fan of NCM but for me it isn’t a buy at the moment.

Weekly chart below