On December 6th, I posted an article that I originally published back in July, calling into question Cintas's effectiveness as an economic indicator.  All along, I've kept track of every subtle price movement on the 60-min chart, hoping to get some clues as to what the 'Uniform Indicator' is really trying to indicate.  The company is now scheduled to report earnings on December 19-22, even though December 5-6 was the originally published date for the release.  Interestingly, the new date coincides with the projected end of the December rally, as I've suggested in the Morning Report For 12/06/2011.  Referring to the time/price chart in that report, December 20 is when the 17th trading session will conclude (the rightmost blue box), counting from the post-Thanksgiving bottom (the rightmost red box).  For now, we'll consider it to be a mere coincidence, but we'll certainly not dismiss it completely.      

Back to CTAS, chart 1 below depicts my interpretation of the wave structure on the 60-min timeframe.  If this analysis holds any water, the price of the stock should face insurmountable difficulty just above $31.  However, should price manage to break through, the true line in the sand will be $32.47, not 1 penny higher. Otherwise, the bearish case will be severely dented, not just as it relates to CTAS, but to the equities market as a whole.


Chart 1. CTAS's price action on the 60-min timeframe.

I for one can't wait to hear what they have to say.

Trade Well,

Peter