HUM - September 6, 2010

On April 23, I wrote about HUM

At that time HUM was at 44.48. It closed this past Friday at 51.08. Not bad eh? S&P is down how many %’ge points since then?

Despite the 10+% gain, I think most of HUM’s price activity has been a continuation of a sideways correction

This is the weekly chart of April 23 that I used in my post


This is a current weekly chart


HUM is uptrending right now and it may have finished its intermediate wave 4. It may also extend the correction and turn it into a more complex structure.

Let’s look at a daily


There is a nasty 9-point gap that hammered the stock early Nov 2009. If the broader count is correct, HUM has to eventually get beyond this gap.

Of course, my count may be wrong and HUM may correct more or collapse. If I wanted I could take some profit (I never get tired of taking profit) and/or sell covered calls somewhere in the gap or beyond.

I can also follow some sort of stop strategy. I sometimes opt for multiple levels of stops and keep a moving set of stops as a guide like this chart where I have 3 levels of concern/stop.


If HUM is to hum higher, it should move in a series of higher lows and higher highs. A move below 47 may be a serious warning.

I shall keep an eye on my levels, and the gap above. How HUM deals with the gap may be the tell of the play.