There are a lot of indicators I like to use to gauge the market, and especially the Greentech sector, but if I had to rely on just one, it’d be the 200-day moving average. I’ll save the history and excellent utility of it for another time and just state that when Greentech is above the 200-day moving average, it’s time to start being more optimistic about the long-term stance of the sector. The moving average is a simple reflection the average of closing prices going back to the start of September (200 trading days ago). When the most recent close is over that average, it’s a bullish signal; when it’s below, it’s skewing bearish. The good news for us is Greentech moved over the 200-day moving average this week and, even with the sector down midday today, it will be a positive if it can close again over that mark. I’m watching the price of 88.77 for the PBW, the WilderHill Clean Energy ETF, and 62.09 for the larger QCLN, the First Trust Nasdaq Clean Edge Green Energy Index Fund. That doesn’t mean we can become indiscriminate buyers – solar stocks, for instance, continue to face big headwinds, and EV stocks continue to be harmed by the rushing to market of companies not ready for prime time. Today’s example is Lordstown Motors (RIDE), which says it may not be able to produce any pickup trucks at all this year without additional capital. Thankfully, we’re not in Lordstown. Our young Greentech Real Money Portfolio is mixed, but, so far, remaining on plan. Chara Solutions (CHRA) We added Chara to our portfolio in last week’s Greentech issue, with a buy price of 6.11. Shares have been reflecting a fair bit of indecision in the market, with charts displaying some typical signs of neither bulls no bears making moves to push prices. CHRA is testing a confluence of support right at 6 today. We’d like to see that level hold but it’s not essential. The CEO made a small buy of shares just under 6 yesterday, which is a sign management feels confident in value at this level. We’re keeping our sell-stop around 5.25 and our recommendation for the fly ash remediator at BUY. Freeport-McMoRan (FCX) FCX sits with us just about break-even mid-day Wednesday. It’s edging lower on no news (but for one Wall Street analyst raising their price target) to test its 40-day moving average just over the price of 40. Technically, shares still have the look of consolidating after their latest leg up. We’re keeping our sell-stop around 38.50 and maintaining our rating at BUY. Steel Dynamics (STLD) As with Freeport, there’s not a lot of news for Steel Dynamics, outside of a couple of bullish Wall Street analyst price target increases, which are nice to have only because they influence buying and selling briefly. Shares have been performing decently, with good buying on volume yesterday, so we will raise our stop-loss. There’s probably enough room for the more cautious to put a stop-loss at our break-even price of 61.13, but we prefer the stop-loss less tight than that, at around the low 59 region–call it near 59.25–which is below the convergence of a few indicators of support. Shares will pay a 26-cents dividend for shareholders of record on June 30. BUY KraneShares Global Carbon ETF (KRBN) We added the carbon emissions credit futures ETF to the portfolio with our most recent Greentech issue, at 34.23. We’re in the black a little bit on the position right now, and seeing more press coverage of the fund as a way to play emissions. We recommended a sell-stop not above 32.95 last week, and we’ll get a little more specific and say the sell-stop should be near 32.75, giving us slightly more room to allow expected support to come in on a possible downward move. Shares remain a BUY. Trex (TREX) Quiet times for TREX means it too is a little directionless at the moment with reasons, chart-wise, to be bullish or bearish. Our reading is that its longer-term uptrend remains intact and our stop-loss recommendation updated in our last issue remains the same, at around 87. That’s an important support area and we could see bears make a run at it. If you’re more conservative, a break below 92 would be a spot to cut losses. All that said, our thesis and the technicals remain intact, and TREX remains a BUY. Thank you for reading and please email with any questions, brendan@cabot.net. The next issue of SX Greentech Advisor is out next Wednesday, June 16.
