We are exiting our PGH position as the stock has broken below this week’s lows and appears to be confirming its recent rollover into a downtrend, at least in the short-term.

Coach BD

PGH took a major hit today but immediately bounced back and Money Flow and Accumulation/Distribution have been steadily climbing since the opening plunge.

There is no significant news other than earnings will be out after the close.  It is possible that some bad news regarding earnings has leaked out causing the opening sell-off.  We are watching it closely and may either buy some ST protection or liquidate, depending on the price action into the last hour of trading.

Coach BD

Just as we were about to issue a possible stop-loss alert on PGH at midday, the stock did an about face and climbed steadily higher for the remainder of the trading session.  The day ended as a high volume reversal day with its highest volume of the year… exactly what we like to see when one of our positions tests support, which PGH did today.  It bounced strongly off of its 50-Day MA at more than twice its normal volume… a very bullish sign.   Both Money Flow and Accumulation/Distribution indicators were positive, giving us supporting confirmation of the positive nature of the reversal.

Next stop… watch for a follow-up day with a close back above its 20-Day MA.

Coach BD

One of our basket of Canadian Royalty Trusts, PGH has broken out on its Daily chart.  It has also broken out on its Weekly chart and in the process, taken out the overhead resistance of its 200-Week MA.  PGH has also moved above its 50-Month MA on the LT Trend.

We like a 2-5% opening entry here with the goal that we may own 3-5 of these Trusts at a total investment of no more than 10% of our Core Portfolio.  The Trust is currently paying a monthly distribution of $.07 / Unit which translates to an annual return of ~7.5%

Though the tax status is undetermined at this point, past distributions have generally been “qualified” which means they are taxed at LT Capital Gains rates rather at ordinary income tax rates, making it an excellent candidate for a spot in your after-tax trading or investment account, rather than in an IRA account.

Other CAD Energy Trusts we are watching for entries are… BTE, ERF, PDS, PVX & PWE

Coach BD

Coach BD

Unfortunately, it appears that o…

PWE – Penn West En…

HTE – Harvest Energy Trust

PVX – Provident Energy Trust

We have held these in the past several times, tending to trade them without regard to holding period since the distributions (dividends) are paid monthly and are usually tax-advantaged, allowing us to pay the Long Term Capital Gains rates rather than ordinary income rates.

We will continue watching and adding to our basket as these and others we have held in the past make good technical reversals.  Others we are watching for new entries are… AAV BTE ERF PDS PGH & PWE

Most of these have maintained their distributions (dividends) and some are paying more than 30% per year with monthly distributions.

We are watching for some good volume upward movement through resistance on several including… AAV, BTE, HTE, PDS, PGH, PVX & PWE.

Stay tuned for new entries. These were very good trades for us last year even though we decided to bail out of them as Oil prices collapsed.  Normally we would want to hold these great dividend stocks for the longer term but after that unbelievable run-up in Oil that took all of the energy with it, we decided to take our significant appreciation and dividend profits and wait for the washout, which appears may be nearing it’s end.

Coach BD