CWCO trade ideas
Short Redistribution Outlook on CWCO I see the redistribution schematic clearly. Market structure is bearish, buying momentum took longer than the selling momentum which is another indication for me. Would wait for a LPSY(retracement ) to form before selling impulsively down while also clearing out the liquidity at the bottom.
Consolidated Water Co. Ltd. Trend Break trade Consolidated Water Co. Ltd. engages in the development and operation of seawater desalination plants and water distribution systems. It operates through the following segments: Retail, Bulk, Services, and Manufacturing. The Retail segment focuses on the water utility for the Seven Mile Beach and West Bay areas of Grand Cayman Islands. The Bulk segment supplies potable water to government utilities in Grand Cayman and the Bahamas. The Services segment designs, constructs, and sells water infrastructure and provides management and operating services to third parties. The Manufacturing segment comprises a range of custom and specialized water-related products applicable to commercial, municipal and industrial water production, supply, and treatment. The company was founded in 1973 and is headquartered in George Town, Cayman Islands.
inverse head and shouldersGreat time to be watching this ticker. and it is a risky play as its on a strong weekly downtrend but we are on the cusp of changing the daily trend. We can see a inverse head and shoulders with lots of bullish divergence and exaggerated bullish divergence. With the big possibility of hyperinflation and the growing world population commodities like drinking water will be even more valuable. potentially a great long-term entry. It even has a 3% dividend to top it off
Water is 2020's winner so farThe 3 leaders YTD have been (in order): Utilities, Healthcare, Staples; which happen to be the 3 most defensive sectors, who tend to outperform during a recession...
Inside the utilities sector, the Water industry is the leader.
CWCO has a beautiful looking chart, setting a strong support after making a double-bottom, which immediately after, made a bullish engulfing candle. It is interesting to note, that the volume on this 2-day event; was almost identical. Meaning the amount of buyers was larger than the seller side.
Capitalizing on Future Water ShortageThe model of CWCO is to go where clean water isn't, and to be the company to provide that place with clean water. It's a tremendously simple business model that exploits a 'batteries included' system of installment, financing, and operations. The company's net profit growth of 27% and its Projected Net Income 5YR Growth average of 27.4% makes this company considerably undervalued to its intrinsic value.
Check out my piece on CWCO on my blog: rockvuecapital.wordpress.com
As always, if you find holes, please expose them so I can learn.
Always trying to improve,
Brandon
CWCO- Bearish Rest Of Year!!CWCO daily chart & larger time frames, $13.00 is major support area. Earnings is coming this week and Elliot impulse wave (12345) up has just completed.
Help a bit closer to home
A second company with the potential to slake California's thirst is publicly traded Consolidated Water (NASDAQ: CWCO). Currently focused on the Caribbean, Consolidated Water not only builds but also operates multiple reverse osmosis desalination plants in the Bahamas, Belize, the British Virgin Islands, the Cayman Islands, Mexico, and Indonesia. While not currently operating in California, Consolidated Water clearly has the technical know-how, and is another logical choice for investment should California move ahead with plans to build more desalination plants.
CWCO DOUBLE BOTTOM CONFIRMED BUT DONT DRINK THE WATER YET!With the double bottom confirmed, I would like to explore the possibility of a 2618 trade. Price is approaching the projected target of 13.00. Here, I expect a pullback in price to begin. Should that happen, we may then look for a long entry near the .618 Fib Ret. level. The idea behind a 2618 trade , as I understand it, is to reduce one's risk when entering a trade. Risk is reduced by the fact that you are waiting to enter at a level closer to the double bottom and the double bottom is already confirmed. I prefer this setup with the trend but it is truly a reversal setup. I believe this chart offers a good look at one, as this double bottom could lead nicely into an IHS to complete the reversal in trend. The two green lines are targets, the red line is the stop and I have added a pitchfork to give the chart a sense of time.