Potash Corp. (POT) Looking Up

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)

About Andrew Wilkinson 1023 Articles

Affiliation: Interactive Brokers

Andrew Wilkinson is the senior market analyst at Interactive Brokers Group, where he provides daily commentary and analysis on U.S. equity options trading throughout the trading day. Andrew provides webinars designed to explain option-related trading scenarios covering futures, fixed income, forex and equities.

Interactive Brokers: Interactive Brokers offers direct market access to around 80 electronic global markets from a single account. Successful traders and investors understand that superior technology and lower trading costs can result in greater returns. For 32 years we have been building direct access trading technology that delivers real advantages to professionals worldwide. With consolidated equity capital of US $4.4 billion, IB and its affiliates exceed 1,000,000 trades per day. In addition, our prudent and conservative risk policies make Interactive Brokers a safe haven for your money. Discover some of the reasons why IB, the largest independent US broker/dealer, is the professional traders' and investors' choice.

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