During the first hour of trading Potash Corporation of Saskatchewan (POT) appears to be attracting a significant bid leaving the shares poised to trade at the highest price in five months. The stock showed up on the Interactive Brokers ‘most active by share volume’ market scanner and has currently traded 4mm shares (10:30amET). By way of comparison that first hour’s volume compares to typical daily volume of around 5.5mm shares.
At $34.04 shares in POT are higher by 1.52% and you can see from the chart the significance of the latest attempt to move higher. POT has struggled since August 2013, remaining below $33.82 until last week. The latest groundswell in volume appears to be a healthy sign of returning investor appetite for the basic materials company. Just prior to the August breakdown the shares found a base at $35.98. Bulls might be hoping for a test back up to that level should momentum continue to build. The IB Probability Lab using options prices to gauge sentiment on the stock suggests that the market currently believes that POT will trade at $32.65 in one year’s time. The company has paid a 35-cent dividend during each of the past three quarters.
Chart – Potash Corporation of Saskatchewan seeing strong volume Tuesday
(click to enlarge)