PGD.TO Peregrine Diamonds – When In Doubt Get Out

by Olivier on December 2, 2010

Don’t have that much to say tonight.
So here’s a quick portfolio positions review and a few thoughts:

  • PGD.TO – Peregrine Diamonds: The stock sure has decent potential. But with today’s gap down I decided to sell and move on. I can always get back in if the stock sets up again. Of course, good news always trumps the chart. But that’s not the point. The stock’s trading personality is outright nasty. This is the exact opposite of what I am looking for. It is violating two rules I follow:

    1. Be in control
    2. Be in sync with a stock and its personality.

    PGD.TO is gapping up and down like crazy. It is not acting as I would expect it to. In my book immediate buying pressure is now gone and the stock will need some time to set up and rebuild pattern pressure. I might very well be wrong. I couldn’t care less. When in doubt, get out. Put another way: Sell and ask questions later. There are literally thousands of opportunities out there. There is no way I will let a stock negatively impact my mental capital. (Dennis Gartman Trading Rule No. 3). I’m moving on. No hard feelings.

  • DNN / DML.TO – Denison Mines: What can I say. Stock is acting right. Uranium is most likely in the beginning stages of a new trend to the upside. Is this a new bull market or just a prolonged move to the upside? There is no way to tell. What I can tell though is that right now the path of least resistance is up. Go with the flow. Don’t fight the trend.
  • UEX.TO – UEX Corp.: Looking great as well and trading in a very orderly fashion. At some point in time we will start a consolidation in order to digest the recent advance. I am not interested in selling or taking partial profits here. The reason why I am sticking to my Uranium positions is the following. The thrusting move is so powerful it is difficult to tell when the next consolidation pattern or period will actually start. UEX.TO might just move to 3.00 or 4.00 before it starts consolidating. Another scenario to keep in mind would be a technically very constructive sideways consolidation which won’t make it easy to reenter. Right now I would expect any surprises to be to the upside. In my book DNN and UEX.TO are best of breed. That’s why I consider it a high odds proposition they will ultimately end up attracting lots of institutional money. Ride the trend.
  • TMB.TO – Tembec: Probably my favourite right now. Same story as a few weeks ago. Nobody cares about pulp/paper/forestry. The stock just keeps moving higher and is a stellar performer leaving even the best performing silver stocks in the dust. The exact opposite of a crowded trade. Next price target should be in the 4.50 – 5.00 range. The chart tells me to hold and to be patient with winners.
  • CNL.TO – Continental Gold: Nothing has changed. The best advice I can give is to re-read the latest press release. CNL.TO published drill results with monster gold grades . As I state in my public list chart annotations, this one probably goes much higher. Patience.

Less is more. – Ludwig Mies van der Rohe

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

Buenas noches!

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