[MCD] is likely about to collapse.

I own Jan 2016 MCD $70 puts.  I bought them way too early based on views expressed in this backlink and they have been languishing since.  But the theme that MCD will collapse in 2015 is alive and well thanks to the recent 500 point down day on the DJIA.  The chart from the backlink is reproduced below and I still model it as being intact.  In other words, the peak of mid 2014 was 5 of C and in fact the peak of the rally that began in 2009.

After that peak, as the dated chart below shows, there were 5 waves down into late December 2014.  AFAIKT, this was the last time I posted on MCD.



If that mid 2014 peak (yes it was slightly higher than that of early 2013) really was the peak as my models indicate it was, the Jan 24 low was likely wave 1 down, then an expanded flat a-b-c whose C wave just ended in late August.  MCD is an important part of the DJIA.  If you think that the UVXY train has left the station, think again.  Watch what happens at that lower red rail.  I expect the chart to crash down through it.  If MCD is going down, the entire DJIA will be plummeting and you will wish you had some out of the money 2017 puts on MCD.

MCD_012017P50 are the Jan 2017 $50 puts with current bid ask last at .08, .40 and .20 respectively.  I think if you can get some for .15 you will be doing very well but if tomorrow is another crash then good luck with that.  Insurance should be coming back into vogue real soon now. 

For the record, I think that the chart will end up being a head and shoulders.  I think the right shoulder has peaked and that the neckline will hold for only a short time before this "kant miss" wall st stock breaks down. 

I am of the long standing view that MCD is a real estate company more than a food company.  When interest rates rise, MCD's high debt load relative to cash is going to catch up to it.  MCD did not earn its assets folks, it BORROWED THEM.  Plain and simple.



Besides this, MCD pays a piddling dividend, not worth the risk of holding the shares.  Yahoo appears to be partially down this morning so I don't know the value of the divvy but I think perhaps 2-3%:



By the way, we are talking about a fast food company with PS of 3.6 when it should be 1.0 and a PB that should be 1.5 or 2.  Even those who think that these "fundamentals" mean something should recognize how ridiculously overvalued these shares are.  But wall st has portrayed them not only as safe but as responsible to put in a retirement portfolio and to me that makes MCD shares nothing less than dangerous and toxic.