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Sunday, December 17, 2006

Weekend Update - $COMPQ, GRMN, EPIQ, ECA & HMY

The Nasdaq Composite ($COMPQ)- Daily Chart

As you can see by looking at the chart, you will see that the $COMPQ has been trading in a parabolic uptrend channel since August '06. As I always say, "Parabolic is not a pattern." When a chart is parabolic, it becomes over extended and needs a pullback/breather before it heads back up. On Friday, the $COMPQ made new 52 week highs at 2470.02, but then hit resistance, and went on to close near it's lows of day at 2457.20. Nevertheless, the $COMPQ remains in it's up trend channel. You can also see that it is trading close to it's moving averages. Therefore, there is still a lot more room for the $COMPQ to move to the top of the channel. Ultimately, the indicators and oscillators are not showing enough bearish divergence to indicate that the wave structure is broken.

Garmin Ltd. (GRMN) - Weekly Chart
GRMN is an old portfolio stock that we used to play. It is a momentum stock play. The weekly chart of GRMN illustrates that has it is in a large ascending triangle pattern. GRMN has not yet participated in the rally. It appears to be close to a triple top breakout. I want to watch GRMN and see how it reacts at resistance. I want to see how it behaves. This is not a buy alert.

Epiq Systems, Inc. - EPIQ - Monthly Chart
EPIQ is a bankruptcy software play. In order to see the big picture of EPIQ you would want to look at the monthly chart. As you can see, EPIQ has been trading in a slim Jim rectangle pattern for the past 6 years. However, in the last 3 months EPIQ has advanced upwards, and is being accumulated. Now EPIQ appears to be forming a large ascending triangle pattern. This month EPIQ has taken out the 13 EMA, and you can see that the moving averages are converging which is bullish. As you can see, resistance is quite a ways off at $26.00. EPIQ is now in a wave 4 to wave 5 move up. Wave 5 is a slow moving wave. Accordingly, it will take time for EPIQ to complete it's move to price target / resistance. Furthermore, oscillators and indicators look to have bottomed are beginning to point upwards. This is B-U-L-L-l-S-H. EPIQ is up 8.96% this month and it closed the week at 17.02. I think everyone should own EPIQ.

EnCana Corp. - ECA - Weekly Chart
The weekly chart of ECA illustrates that, it too, is also in the process of forming an ascending triangle. ECA trades with a P/E of 5.81 and presents itself as a good value and fundamental play. If this is what you are looking for, you may want to start building a position in this low P/E stock. ECA has been moving up steadily ever since it retested it lows this year at $42.75. You can also see that steady volume, showing accumulation, has been supporting the stock's price since the beginning of October '06. In addition, you can see that the moving averages are beginning to converge/crossover meaning there is support at current prices, and that a move upwards is in the works. ECA is still in a wave 3 to wave 4 correction. We want to be in ECA for the move to wave 5. Furthermore, the indicators and oscillators are moving upwards along with price. ECA is a lower risk investor trade, meaning that it is meant to be held for 3 to 6 months or until price target is reached at $70.00.

Harmony Gold Mining Company - (HMY)- Weekly Chart
HMY is in an ascending triangle pattern. As you can see by looking at the chart HMY has successfully completed it's wave 3 to 4 pullback to the long term uptrend line. It is now in it's wave 4 to wave 5 move. Last week HMY had a bullish Aroon cross which caused a pullback on light volume to the 13 EMA, which it held. In addition, the indicators and oscillators are bullish and moving up along with price. This week HMY closed up 3.64% to end the week at $15.95. If you have extra money and do not own HMY, I am reiterating a buy here.

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