Hope everybody enjoyed the short Easter break! Thought I would write a bit about my newest portfolio position. I usually pay more attention to the technicals but PKL.TO – PC Gold offers huge story stock potential in addition to excellent technicals. For those not familiar with what I am typically looking for, here it is:
- Rather long base.
- Game changing news / fundamentals.
- Abnormal volume surge.
- Gap up.
- Thrusting move.
- Consolidation pattern. Preferably an ascending triangle.
- Story stock potential.
- Potential to attract the momentum trader crowd.
- Market capitalization that leaves a lot of room for additional price appreciation.
The same thing that happened with KIV.V – Kivalliq Energy applies to PKL.TO – PC Gold.
- The stock is acting as expected.
- The stock is trading at an all time high.
- After I put on the trade the stock almost immediately went my way. Great trades work right away as the saying goes.
I know this may sound repetitive. The truth is: Successful trading should be boring. Don’t get me wrong. Trading as a whole is the most fascinating endeavor, at least in my book, the actual process of putting on trades and exiting trades though should be as unemotional as possible. Simply repeat what yields the best results. With PKL.TO it is all of the above mentioned. The story is new. That’s what the market loves. As Nicolas Darvas rightfully pointed out in his book you do not want to bet on old leaders. Go for the new stories. That’s the stocks with the best potential for price appreciation. PKL.TO – PC Gold will have to release additional great drill results in order to move significantly higher. As of yet the chart tells me we are headed much higher. If all those good things are indeed about to happen newsletters and institutional money will have to enter the stock. That’s what makes new stories so attractive.
Up-to-date PKL.TO – PC Gold chart on my public list.
As the company states on its website:
PC Gold is: Old Mine Exploration At Its Best
Gold & sulphides in the newly discovered No. 19 ‘Golden Beast’ vein PC Gold holds 100% ownership of Pickle Crow, one of Canada’s best known past producing gold mines, located in northwestern Ontario in a belt of rocks well known for its rich gold deposits. The Company believes there is considerable gold left in place within or close to the mine, and a major exploration program is unfolding with the objective of quantifying what remains, and making new discoveries.
The potential to revitalize old Ontario and Quebec gold mines has been recognized by other present-day resource companies such as Goldcorp, Detour Gold, Osisko Mining and Kirkland Lake Gold, all of whom have achieved success with the old mine redevelopment model. PC Gold recognizes similar potential at Pickle Crow, and intends to follow the same path trodden by its peers with the re-exploration and redevelopment of this well-known past producer, at one time among the best known underground gold mines in Canada.
The old adage might apply here: When you find gold there is probably more to be found. Right now the potential for great deep drill results is there. There is no way to tell if this is another red lake type find like GG Goldcorp discovered but the potential is there. The private placement will close on April 20. That’s more or less exactly the amount of time the chart will need to set up a bullish flag or ascending triangle type of pattern in order to break out to the upside again.
As indicated in the newsletter I sent out I bought the first deep pullback. Today’s price action is exactly how one would expect strong stocks to behave like. The stock was able to trade back close to 10 -15% of its all time high although volume continued to decrease. Price appreciation on decreasing volume within a consolidation pattern. From a technical perspective I couldn’t have asked for more.
A few market thoughts and observations:
- KIV.V – Kivalliq Energy: Another day and separation from the initial breakout level should be complete. Closing at or above 0.50 $ will set the stage for higher prices.
- ANO / ARQ.V – Anooraq Resources: Excellent technical action. Very healthy volume. No immediate overhead resistance. Incredible buying pressure. The stock looks like it wants to go to 2.00 $ rather sooner than later. Platinum Sector Overview Chart.
- BIM.TO – Baffinland Iron Mines: The stock looks like it is finally breaking out for real. Iron Ore Sector Overview Chart.
- CYD – China Yuchai: CYD along with CAAS – China Automotive are starting to look very bullish. China Automotive Sector Overview Chart and Halter USX China Index Components
- SLV – Silver ETF: Silver hasn’t looked back since AGQ Double Silver ETF put in a hammer reversal candle. Right now silver is leading the precious metals higher.
- APKT – Acme Packet: Still a great stock to watch for market timing clues. I had to redraw the consolidation pattern as APKT powered higher.
Your main purpose must be to keep the mind clear and well balanced. Hence, do not act hastily on apparently sensational information; do not trade so heavily as to become anxious; and do not permit yourself to be influenced by your position in the market. – G. C. Selden
My public list with all my charts can be viewed here:
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2791469
Have a great evening!
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