Why others are interested: Goldfield Corp. (GV) was a storm play after Hurricane Harvey. The company helps rebuild power and communication lines and makes it clear on its own web site that it profits from disasters and troubling times; based on where it does business and on its stock chart, it was a screaming buy as the flood waters were cresting.

With Hurricane Irma now bearing down on the Florida coast and the southeast – another area that Goldfield works – some investors are assuming another storm will bring another jump price for GV.

Yes, the stock — which peaked above $5.50 – was helped out by the idea that Irma is coming, but buying it now would be a chase. A long-term investor might be interested, because the company does have good prospects, but it would take a long time to pay off from current levels.

How I played it: I bought 5,000 shares of GV on Aug. 27 at $4.25 and everything I expected to happen with the stock actually came true. I sold half of my position on Aug. 31 at $4.70, and the rest on Sept. 5 at $5.30 for an average price of $5 on my shares, a 17.5 percent profit.

Listen to Taylor’s late August buy recommendation on GV

What must change for GV to be a play again: A natural pullback to roughly $4.75 – if it can find some support – would make Goldfield a stock to watch. What I would like to see is a 50 percent retracement from its recent highs back towards recent lows, which might make for a Fibonacci play with room to run back to recent highs and – if the latest hurricane helps – beyond.

But until that happens, leave GV alone. An entry above $5 at this point is just not smart.


    Taylor Conway is the lead day trader at PennyPro.com. He is a short-term day trader of stocks and ETFs. He currently has no shares, options or open orders in GV, having traded 5,000 shares in the stock as a swing trade as described in this commentary.

Author: Taylor Conway

Taylor’s Shadow Trader system allows his subscribers to tap into the hidden corners of Wall Street and to capitalize on “dark pool” trading activity. This powerful "follow the big money" strategy uncovers large trade activity that most regular investors have no access to, but that Taylor’s subscribers receive alerts about. Starting with a small account and trading part time, Taylor rapidly built his personal trading millions using his own proprietary trading systems. Sharp, savvy, and highly driven, Taylor looks for profits in any market condition, bull or bear.

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