Peregrine Diamonds PGD.TO TSX – Chart Analysis With Price Targets

by Olivier on November 12, 2010

My newest portfolio addition is PGD.TO – Peregrine Diamonds. This is truly a company with excellent potential for price appreciation. I am simply doing what the subtitle of my website states:  ‘Trading High Potential Stocks’. There’s a lot I could write about the fundamentals that make PGD.TO – Peregrine Diamonds a high potential stock, I’ll stick to the technical stuff instead.

  • Private placement just closed. This increases the odds for news to flow soon.
  • Perfect pattern pressure. Long base. Bullish cup and handle pattern.
  • The stock broke out right away. The best trades tend to work right from the start.

I added some annotations and decided to add a few months of additional trading history to the ‘Small Size Chart’ on my public list. That will help illustrate why PGD.TO – Peregrine Diamonds looks so bullish. As you can see, volume was huge last year. More than a year has passed to digest those massive gains. Over the last 4 months the stock has put in a series of higher lows. The overall pattern is a bullish cup and handle pattern. Now volume needs to kick in. According to a famous adage, if price starts to move volume tends to follow and confirm. The stock opened with a gap up which is bullish as it triggered all the buy orders that were placed to capitalize on the technically ‘correct’ breakout around the 2.70 – 2.75 level. I anticipated that move that’s why I was willing to enter a bit earlier. Now I am patiently waiting for follow through. If volume confirms further rising prices the stock looks like it is headed for its first price target in the 3.50 – 3.60 CDN Dollar area. If the stock acts well, my best guess would be it will then test its all time high at 4.60 CDN$ Dollar. Let’s see what happens.

PGD.TO TSX Peregrine Diamonds Price Target Technical Analysis Chart Pattern Cup Handle Long Base

Up-to-date PGD.TO – Peregrine Diamonds chart on my public list.

Go check the following chart comparison of PGD.TO’s peer group: : Peregrine Diamonds Ltd. (“Peregrine” or “the Company”) is primarily focused on diamond exploration and development in Canada. Since 2007, the Company has discovered two new Canadian diamond districts, Chidliak and Qilaq on southern Baffin Island and Nanuq in the eastern Arctic region. In addition, Peregrine has established an independent, NI 43-101 qualified, indicated mineral resource of 18.2 million carats in the DO-27 kimberlite in the Northwest Territories and has early stage exploration projects in the Northwest Territories, Nunavut and Manitoba. In its search for diamonds, the Company has a secondary focus on exploration for metals deposits. Industry experts predict that without significant new discoveries in the coming years, the global demand for diamonds will soon outstrip supply. Through its quality diamond exploration projects throughout Canada and its 71.74 percent ownership interest in the DO-27 mineral resource, Peregrine is well positioned to contribute to the world’s diamond supply in the future. In 2010 Peregrine is conducting exploration programmes at the Chidliak, Qilaq and Cumberland Projects on Baffin Island, Nunavut, as well as at the Nanuq and Nanuq North Projects also in Nunavut. The Company will provide regular updates on these activities throughout the year.

I measure what’s going on, and I adapt to it. I try to get my ego out of the way. The market is smarter than I am so I bend. – Martin Zweig

My public list with all my charts can be viewed here:

Buenas noches!

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