3SOF

TGB was up 12% today, and that's only my number 2 copper play, imagine PCU, which is my number 1 !

Of course, it doesn't have the same potential, since PCU is already a $16.8 B market cap company and TGB is just $217 M. But the market reaction on TGB goes to show how attractive and unknown fundamentals are at copper mining companies. People don't believe or notice them until the numbers are splashed on their screens. And then stocks do what they have to do to reflect the improving fundamentals.

PCU is a 9% dividend yield, 8 times earnings stock. And the price of their product is up 400% over the last four years. Yet, almost nobody believes copper mining is an attractive sector, perhaps because the industry is so old ... so old that we don't see much people interested in entering the sector, adding to production capacity, hence the long term appreciation of $copper prices.

I know $copper is down from it's highs and I guess this is exactly the right time to buy it, on a medium term correction within a long term bull market for the commodity.

Anyway, I've been a bull in $copper since 2001, and reaffirmed by bullishness about a month ago, and in the meantime (this last month) $copper went down some, so ... perhaps I'm wrong ! I always keep my mind opened to all possibilities.

For now I'll continue holding PCU, expecting it to breakout to new all time highs above $58.38.

PCU was down ugly today, more than 4%. The stock just touched its ascending support as you can see on the chart below. Just below the ascending trendline there's the 50 days SMA also providing support.

The long/medium and short term trends are still bullish, despite today's sell off. I need to be coherent and continue holding the stock, at least for now.

But it did cross my mind today that I should sell it based on the following theory:

"The fundamental status isn't all that important. What matters most is the change in fundamentals, or the potential change".

But now I look at the chart and think: the market still didn't say my fundamental assessment of PCU is wrong. But if PCU is set to close below $54, then I think it is clear there was at least a short term top and the stock may go down about 10 or 15% more.

You can see I have doubts. I'll let the market decide on my course of action. So, the trading plan for tomorrow is: SELL PCU if it is set to close below $54. Otherwise HOLD.

QuoteYou can see I have doubts. I'll let the market decide on my course of action. So, the trading plan for tomorrow is: SELL PCU if it is set to close below $54. Otherwise HOLD.

Sold PCU at $52.4, according to plan.

Its a pitty this one turned out to be such a bomb. I should of went with my gut feeling on this one and stayed out. I had a feeling the nationwide construction slowdown would come back to hit copper prices down.

My eyeballs about popped out when I looked at PCU this morning.      

Quote from: David Randolph on December 21, 2006, 04:01:20 PM
Sold PCU at $52.4, according to plan.

David sold PCU on December 21, when a short-term trendline broke after the stock had put in a short-term "Double Top."

Certainly a very reasonable choice on David's part.

In addition to that short-term picture, all day long on December 21 on CNBC, it was non-stop about the drop in the price of copper.  Then, at about 2:30PM, PCU got "Cramerized!" (cumulina ought to patent that term  ).

Cramer called for a COLLAPSE in copper, said that he wanted nothing to do with copper stocks, and specifically said, "Sell PCU." 

No, he SCREAMED it.

I think he hit the cash register a few times, and then screamed some more.   

Mercy!   

It always interests me to see what a stock does after a "Cramerization" (I have to ask cumulina if that's a word  ):

1. Seven sessions after it got "Cramerized," PCU put in a Bullish Doji Star Hammer just above technical support at the July-October Rectangle.

2. PCU then formed a Bullish Inverse H&S, and broke out of it on January 19.

3. It closed at a new high on Wednesday, and is nearing the 61.64 target IN PLAY.

Very, very difficult to buy that Bullish Doji Star Hammer at support on January 4 if we had been watching it, after PCU got Cramerized with a COLLAPSE call, but what an OUTSTANDING play, if anyone bought it there, huh?!

I still have PCU in my fathers portfolio. Its a mostly high dividend porfolio.

Bought PCU on Jan 8th @ 51.50
As you can see on the following charts PCU is following the mostly the same pattern as FCX and Copper futures.

Nevertheless going back and comparing PCU with $copper there is
at this moment a remarkable divergency which from time to time comes
back to zero. The question is which one will lose some ground to close
the difference.

PCU - FCX

Quote from: jorgegr on January 27, 2007, 07:53:49 PM
Bought PCU on Jan 8th @ 51.50
As you can see on the following charts PCU is following the mostly the same pattern as FCX and Copper futures.

jorge,

That's a fine play you made there.  Applause. 

Even though I always defer to the techicals over the fundamentals when I have to choose between the two, if I had seen PCU put in that Bullish Doji Star Hammer at technical support on January 4, I would have passed on that trade. 

Given how bad the copper chart looked, I would have respected that, and I wouldn't have given PCU much chance of rallying against it, let alone rallying to a new high!  Wow. 

That's why I said that I thought it was a very difficult play to make, and it's another good market lesson for me.   I have difficulty with it,  because I always want the market to "make sense," and I keep having to remember that, very often,  it doesn't make sense.

Quote from: nullzero on December 22, 2006, 12:16:14 PM
Its a pitty this one turned out to be such a bomb. I should of went with my gut feeling on this one and stayed out. I had a feeling the nationwide construction slowdown would come back to hit copper prices down.

nullz,

And, that was right.  Copper prices did come down, but PCU didn't.   

Quote from: nullzero on January 27, 2007, 04:34:15 PM
I still have PCU in my fathers portfolio. Its a mostly high dividend porfolio.

Nice.  I think PCU is one of the highest paying dividend stocks.  Last quarter was something like 1.37 a share, if I remember correctly.  Tell your dad that he has to share next quarter with you for making him such a nice pick.   

Quote
Nevertheless going back and comparing PCU with $copper there is
at this moment a remarkable divergency which from time to time comes
back to zero. The question is which one will lose some ground to close
the difference.

Right, jorge.

There's a big "disconnect" between the two, isn't there?  Even CUP is doing well against copper.  It just took out the 4.09 - 4.10 highs of TWO ugly, ugly black candles!

I'm lousy at predicting, but I'd say watch to see if the 61.64 target gets MADE, and watch to see if PCU can hold above the highs of the current Rectangle breakout.

See the last Rectangle that broke out on October 13, around the time that copper started doing a header to the downside? 

That breakout put 57.43 IN PLAY, which MADE with no problem.

This breakout on January 24 put a target of 66.82 IN PLAY.

Math:

58.23 - High (the more conservative of the 58.38 and 58.23 highs)

49.64 - Low (the more conservative of the 49.64 and 49.16 lows)

58.23 - 49.64 = 8.59 Points + 58.23 = Target: 66.82

Good luck with this one, guys!

Thanks Melf for your detailed TA, very usefull  comments.
I see  RSI, Dist/Accum., and FULL STO too high, may pullback
before achieving the target. Will keep an eye on $copper
hoping it breaks 280

Sold today @ 64.55

Quote from: jorgegr on February 05, 2007, 03:08:29 PM
Sold today @ 64.55

jorgegr,

Great trade!  Congratulations.  Applause.

PCU has had a stunning, straight-up rally off the 49.16 low.  It goes ex-dividend on Friday, and the dividend has been raised to 1.70, so that probably has helped to propel the stock higher.  The shorts don't want to pay that kind of dividend because it isn't likely that they have received dividends to offset it.

Looks like the shorts are bailing out big time. No point in selling PCU for my fathers porfolio he doesnt have more then 2k in it, its better to get the divy and reinvest with a drip over time.

THX Melf for your guidance. Got out because believe it reached the top of the trend line & dont want to wait until friday.
On the other hand $copper falling & believe this rally is exhausted considering
Full STO, RSI, MACD and CCI.

Maybe I'm wrong, in any case GLTA holders.

PCU trading at 65.56 still making new 52wk highs